A Step Forward on Infrastructure

Final fiscal year 2018 appropriations were signed into law on March 23 by President Trump. He was not entirely happy about it. The President referred to the bill as a “ridiculous situation” and vowed never to sign another bill like it. He made these comments even though the White House posted on its website a lengthy list of talking points referring to the bill as a “win for the American people.”

​The White House talking points included several mentions of infrastructure spending in the bill, including the following statements:

"A WIN FOR AMERICAN INFRASTRUCTURE: The omnibus provides robust funding to rebuild our Nation's infrastructure:
     "· The bill provides robust funding for infrastructure.
     "· This includes $635 million in rural broadband and $2 billion to address VA’s maintenance backlog.
     "· The bill also includes substantial funding increases for traditional core infrastructure, such as highways, airports, railways, and waterways.
     "· A significant share of this funding increase is directed to competitive, merit-based infrastructure grant programs with no special advantage to certain projects."

In total, the bill increases nondefense infrastructure spending over last year’s appropriations by $21.2 billion, according to the House Committee on Appropriations. It’s a start on funding the Administration’s infrastructure plan, which called for $200 million in federal funding to leverage $1.5 trillion in funding from all sources to improve the nation’s infrastructure.

Exactly where is the infrastructure spending growth in the final appropriations bill?

Transportation:

Funding for highway projects increases $3.5 billion, including $2.5 billion for a new “Highway Infrastructure Programs” appropriation that is available for various road and bridge projects across the nation.

​High-priority construction at airports receives $1 billion in new appropriations, prioritizing small and rural airports.

The Transportation Investment Generating Economic Recovery (TIGER) program, which provides targeted grants to communities for transportation infrastructure modernization, has a $1 billion increase over FY 2017, for a total of $1.5 billion.

Rail and transit programs see increases in several areas including transit infrastructure grants (+$834 million), transit capital investment grants (+$232 million), consolidated rail infrastructure and safety improvements (+$525 million – including $250 million for Positive Train Control), a state-of-good-repair program to reduce the repair backlog on rail infrastructure (+$225 million), and Amtrak (+$447 million).

Information technology (IT) infrastructure:

A new rural broadband pilot program in the Department of Agriculture receives $600 million to improve internet access and support economic development, education, and health services in rural communities.

The General Services Administration (GSA) is appropriated $100 million for the IT Modernization Fund authorized by the recently-enacted Modernizing Government Technology Act. The Act authorized $250 million in both FY 2018 and FY 2019 to improve IT and enhance cybersecurity in federal agencies. While the FY 2018 appropriation is less than the authorized amount, it represents a significant amount of money considering the fiscal year is near half over.

The Social Security Administration has a $200 million increase for its IT modernization effort, which will update systems that are in many cases over 30 years old.

In the Department of Commerce, the National Telecommunications and Information Administration (NTIA) receives $7.5 million to update the national broadband availability map to help identify areas in the country that lack adequate broadband service. The bill also includes $8.2 million for NTIA for other broadband programs and allows funding under the Economic Development Administration to be used to support broadband infrastructure.

The Department of Homeland Security’s National Protection and Programs Directorate receives an increase of $54 million over last year, including +$47 million for the National Cybersecurity and Communications Integration Center.

Federal facilities:

The bill includes an infrastructure general provision for the Department of Veterans Affairs (VA) that appropriates $2 billion for medical facilities ($1 billion for nonrecurring maintenance), minor construction ($425 million), and construction of state extended care facilities ($575 million). The $1 billion medical facilities appropriation, together with a $459 million increase under the VA’s regular Medical Facilities account and a $361 million FY 2018 advance funding increase in last year’s appropriations bill, brings the total FY 2018 increase over last year for VA medical facilities to $1.82 billion.

GSA’s Federal Buildings Fund has a $486 million increase for construction of new federal courthouses and land ports of entry across the country.

Other infrastructure:

Community development funding for state and local infrastructure needs: +$1.9 billion.

Environmental Protection Agency infrastructure funding: +$766 million, provided for the Hazardous Substance Superfund (+$63 million), State and Tribal Assistance Grants (+$650 million for clean and safe drinking water infrastructure), and Water Infrastructure Finance and Innovation loans (+$53 million).

Army Corps of Engineers and Bureau of Reclamation water resources projects: +$918 million.

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Compared to FY 2017 funding levels, the FY 2018 appropriations bill provides an overall increase of $138 billion (+13%) for base discretionary spending (i.e., appropriations subject to the spending limits set in law). Defense programs increase $78 billion (+14%), and nondefense programs increase $60 billion (+12%).

Infrastructure programs, with a $21.2 billion hike, receive 35% of the increase to total nondefense spending – a healthy boost to jump start improvements to the nation’s aging infrastructure. This level of infrastructure spending is likely to hold steady or increase slightly in the next budget cycle, since total FY 2019 nondefense discretionary spending is expected to increase by about 3% based on the spending limits in the Bipartisan Budget Act of 2018.