Law360 (June 24, 2021, 6:45 PM EDT) — In a major step toward advancing his economic agenda, President Joe Biden reached a deal Thursday with a bipartisan group of U.S. senators on an estimated $1.2 trillion infrastructure plan, but it likely hinges on passage of a separate reconciliation bill addressing the president’s other legislative priorities.
After months of negotiations, the Biden administration and senators from both parties reached agreement on broad targets for a once-in-a-generation investment in modernized highways, roads and bridges built for climate resilience, electric vehicles, public transit, expanded broadband internet and upgraded power grids, among other things.
The bipartisan infrastructure framework calls for a total $973 billion investment over five years, or $1.2 trillion over eight years, with approximately $579 billion of that amount dedicated to new investments in roads, bridges and major surface transportation projects, passenger and freight rail, public transit, electric vehicles, airports, ports and waterways, as well as clean water, environmental remediation and other infrastructure.
The framework announced Thursday is scaled down from the president’s $2 trillion American Jobs Plan and includes compromises on some major Republican sticking points. It prioritizes investments in so-called core infrastructure such as highways, roads and bridges and won’t bank on the aggressive corporate tax hikes that Biden initially proposed in March.
During a Thursday afternoon press conference, Biden said that the plan doesn’t include any tax increases on those earning less than $400,000 annually, and that there would be no gas tax increase or fees on electric vehicles.
According to a fact sheet from the White House, the plan will be financed through a combination of closing the tax gap and bolstering Internal Revenue Service enforcement efforts, assessing targeted corporate user fees and what the administration called the “macroeconomic impact of infrastructure investment.”
Unused funds from the emergency relief legislation passed last year in response to the COVID-19 pandemic, as well as unused unemployment insurance funds, will be redirected to help pay for the infrastructure plan, the White House said.
Other means of paying for the plan include having states sell or buy unused toll credits, reinstating Superfund fees for chemicals, using proceeds from 5G spectrum auctions and generating revenue from selling off strategic oil reserves, according to the White House fact sheet. Further details on how such funding mechanisms would work weren’t immediately available.
However, Biden indicated that he’s not abandoning other top-priority items in his American Jobs Plan, such as his clean energy and climate-focused goals, as well as ongoing efforts to expand child care, paid family leave, education and other social programs. The president said he expects lawmakers to address those items in a separate budget reconciliation bill, making clear that he won’t sign one bill without the other.
The bills must move ahead “in tandem,” Biden said.
The senators who helped hammer out the deal include Richard Burr, R-N.C.; Bill Cassidy, R-La.; Susan Collins, R-Maine; Chris Coons, D-Del.; Lindsey Graham, R-S.C.; Maggie Hassan, D-N.H.; John Hickenlooper, D-Colo.; Mark Kelly, D-Ariz.; Angus King, I-Maine; Joe Manchin, D-W.Va.; Jerry Moran, R-Kan.; Lisa Murkowski, R-Alaska; Rob Portman, R-Ohio; Mitt Romney, R-Utah; Mike Rounds, R-S.D.; Jeanne Shaheen, D-N.H.; Kyrsten Sinema, D-Ariz.; Jon Tester, D-Mont.; Thom Tillis, R-N.C.; Mark Warner, D-Va.; and Todd Young, R-Ind.
In a joint statement Thursday, the senators said they’re “proud to advance this bipartisan proposal to make a historic investment in America’s critical infrastructure needs, advance cleaner technologies, create jobs and strengthen American competitiveness without raising taxes.”
“This agreement shows that the two parties can still come together, find common ground and get things done that matter to everyday Americans,” the senators said. “We are happy to have President Biden’s support, and will now get to work enlisting the support of colleagues on both sides of the aisle.”
The American Society of Civil Engineers said in a Thursday statement that it was encouraged by the bipartisan infrastructure deal, noting that it includes more than $550 billion in new investments to revitalize the nation’s roads, transit, water systems and electric grid.
“Deteriorating infrastructure deficiencies is costing each American household on average $3,300 per year if swift action is not taken,” ASCE President Jean-Louis Briaud said in the statement. “This bipartisan framework could mitigate those losses.
“American families and businesses are counting on Congress to work together to deliver safe roads and bridges, clean drinking water, reliable electricity and climate-resilient communities. We commend this group of senators for their leadership, and urge the full Congress to act quickly on the agreed-upon framework and pass legislation next month.”
–Editing by Alanna Weissman.