House Weighs Infrastructure Spending
The House Ways and Means Committee is taking a long-overdue look at infrastructure funding, an important area for commercial real estate and a priority issue on NAIOP’s legislative agenda.
Last week, the committee held its first public hearing on the subject in more than three years. Lawmakers agreed on the immediate need for additional infrastructure spending, but the question of how to pay for it remains unresolved. Democrats generally favor direct federal spending, offset by an increased gas tax, vehicle miles travelled (VMT) fees, and other funding mechanisms.
Republicans appear eager to find a solution as well. Rep. Sam Graves (R-MO), the Transportation and Infrastructure Committee’s ranking member, said at the hearing that “everything is on the table,” referring to revenue-raising options. But some Republicans argue that the gas tax is not a viable, long-term solution, given the proliferation of fuel efficient and electric cars, and have raised privacy concerns over VMT fees, which would require tracking vehicles.
NAIOP backs an all-of-the above approach, supporting greater use of public-private partnerships, continued federal funding for maintenance and repair, and a more effective, transparent and streamlined regulatory environment for major infrastructure projects.
Despite the lack of consensus, the Ways and Means Committee’s involvement in the infrastructure debate is notable. Legislation that raises revenue must originate in the House; the hearing therefore signals Democrats’ desire to move a bill with some sort of tax-raising component.
House Transportation and Infrastructure Committee Chairman Peter DeFazio (D-OR), who testified at the hearing, is expected to reintroduce his Penny for Progress Act later this year. The bill calls for $500 billion in infrastructure spending, financed by Treasury bonds which would be repaid with revenue from increased federal gas and diesel taxes. It’s unclear whether other bills will be reintroduced, or if Republicans will offer their own infrastructure proposal.