The Trump administration wants to spend $20 billion on a range of risky but potentially “transformative” infrastructure projects, such as satellite networks to provide rural broadband, new launchpads for private rockets, and “augmented reality” technologies to visualize and manage urban traffic congestion, a senior official said Wednesday.
The administration “is already prepared with ideas” for “surgically-targeted” projects, Commerce Secretary Wilbur Ross told senators as part of a broad, multiagency push for momentum on a 10-year, $200 billion infrastructure proposal facing head winds on Capitol Hill.
Ross was joined by the secretaries of transportation, agriculture, energy and labor for testimony before the Senate Commerce Committee, and offered new details on “bold and innovative projects … that would not otherwise attract private investment without federal incentives because of the risk.”
But the phalanx of cabinet chiefs provided no new information on the more pedestrian but pivotal question of how the president’s team would pay for its infrastructure aspirations. Ross, Transportation Secretary Elaine Chao and others repeated their refrain that the administration would rely on states, localities and private firms to come up with $1.3 trillion more to make a dent in the nation’s multitrillion-dollar infrastructure needs.
Speaking to reporters following the three-hour session, Sen. John Thune (R-S.D.), the third-ranking GOP leader in the Senate, signaled that the far-reaching program envisioned by administration leaders butts against tough realities in Congress.
“Unless someone’s willing to bite the bullet and come up with a new funding source, there are limitations to what we will be able to do,” Thune said.
He said his colleagues had in recent years identified several “offsets” to pay for previous infrastructure needs. Those included relying on a budget maneuver to help keep the nation’s Highway Trust Fund afloat.
Senate Democrats, meanwhile, have proposed funding $1 trillion in infrastructure projects by reversing some of last year’s tax cuts and jettisoning a tax break benefiting investment managers. But the idea of undoing what many Republicans see as a crowning achievement was rejected by each secretary.
Still, Thune said the administration, and Trump himself, would probably need to throw its weight behind specific new revenue to make things happen.
“If they really want to do the scale of what they’re talking about doing, then at some point they’re probably going to have to get behind some form of pay-fors. And I think it’s going to take the president to do that,” Thune said. “I just don’t think there’s going to be enough support up here for new revenues to do the kind of thing they’re talking about doing. But that doesn’t mean we can’t do something.”
Trump privately voiced support in a meeting with members of Congress last month for a quarter increase of the 18.4-cent gas tax. The levy was last raised in 1993. Business groups back the move, though conservative members have balked and administration officials have sought to evade being pinned down on the issue.
There also is some concern among advocates for highway and transit projects that Trump could seek to use a gas-tax hike to fund his broader infrastructure initiative rather than to shore up the Highway Trust Fund, which is facing a shortfall of more than $120 billion.
On Wednesday, Trump’s emissaries said states could sell off public assets to come up with the share of the capital they would need to qualify for the administration’s proposed incentive grants.
“If there are assets that the state has that it chooses to divest of, and apply those proceeds, that certainly counts as a match,” Ross told Sen. Jon Tester (D-Mont.).
“So what you’re saying is if they were to sell their state lands, that would count as a match?” Tester asked.
“Whatever assets they would sell could be eligible to be a match,” Ross said.
Tester responded that “selling their roads for toll roads” wouldn’t work in any rural state, and definitely not in Montana. Same for selling his state’s public lands, which bring in billions of dollars in benefits and tens of thousands of jobs.
“I don’t understand how this plan is well thought out at all to get things built,” Tester said.
Chao weighed in, telling Tester, “For rural America, you’re right, the region is different.” She also noted that the administration’s plan sets aside $50 billion in grants to benefit rural areas.
Energy Secretary Rick Perry noted an addendum to his old maxim about infrastructure spending, which had been: “You got three choices. You got tax roads. You got toll roads. Or you believe in the asphalt fairy.”
Another option, Perry said, is “predictability, stability in the regulatory and permitting process,” part of Trump’s push to speed projects through environmental reviews, which he said will save states large amounts of money.
Among the other ideas for transformative projects cited by Ross were “regional hub concepts that link multiple states’ economies” and “blockchain supply-chain management,” though he provided no further details. Other officials have offered high-speed projects such as proposed hyperloop systems as possibilities.
Also being considered are new technologies for dredging deeper ports and broader use of high-resolution tools allowing better navigation of congested waterways, Ross said.