Category Archives: Infrastructure

Fleecing America’s builders

Source: Maryam Jameel, Center for Public Integrity, August 21, 2017

… The Wage and Hour Division must enforce at least 14 statutes across the nation’s 29 million businesses with a team of only 929 investigators as of the end of June. Federal agencies, which spent more than $470 billion on contracts during the 2016 fiscal year, are saddled with a flawed system to vet contractors and monitor their compliance with those laws. As a result, contractors’ violations rarely show up in government databases. Subcontractors, which often employ most of the workers on construction projects, get even less scrutiny.

Last year, the federal government spent more than $40 billion on contracts covered by Davis-Bacon. But a Center investigation found that about 70 percent of the businesses caught violating the law in 2016 don’t appear in federal databases designed to track companies’ contracting records. Weak oversight allows subcontractors in particular to shortchange workers on government projects with little fear of being caught or barred from future contracts. Meanwhile, their overseers often maintain clean labor records and continue to win government business. This fiscal year, federal agencies have spent more than $425 million on contractors found to have violated Davis-Bacon in 2016, according to U.S. Treasury and Labor Department records analyzed by the Center. The top spenders: The U.S. Department of Defense and the GSA. …

Taking the P3 Route to Reinvent Downtown

Source: Charles Renner, Public Management, July 27, 2017

… The past decade has seen a steady increase in the use of P3 structures, and 2016 was something of a watershed year with multiple high-profile projects coming online that address a variety of public needs, including a $1 billion water infrastructure project servicing San Antonio, Texas, the site of ICMA’s 2017 Annual Conference. In each case, the public sector identified a future need aimed at supporting the attraction of mobile talent, evaluated the limits of going it alone, engaged a P3 partner, and found leadership to achieve results. …

A Sioux Falls Renaissance … A key part of the updated Downtown 2025 Plan is increasing the CBD’s available commercial and residential real estate. To help accomplish this, Sioux Falls opted for a P3 solution to design, build, operate, and maintain a mixed-use facility with retail, office, and residential uses that will ultimately increase the density of downtown. …

Nebraska Innovation Campus and P3 … Located adjacent to the University of Nebraska-Lincoln, NIC is a research campus designed to facilitate new partnerships between the university community and private businesses. …

San Antonio’s Vista Ridge … As a result, the San Antonio Water System (SAWS) crafted the vision of a 142-mile water pipeline project called Vista Ridge that will deliver enough water for some 162,000 new families by 2020, providing a 20 percent increase in water supply. … SAWS opted for a P3 undertaking in order to engage private equity and much needed development expertise in securing and constructing a resource delivery project that requires roughly $1 billion in investment, thousands of private water commitments, along with the 142 miles of built-to-last water pipeline. …

Opinion: Trump’s infrastructure order falls far short of his campaign promises

Source: David A. Super, The Hill, September 9, 2017

… With congressional Republicans allergic to finding new resources from anywhere except cutting programs for the poor and his own political influence flagging, the president has effectively abandoned his infrastructure plan without a fight. Indeed, his proposed budget would further starve already underfunded domestic programs — necessitating still more deferred maintenance — to fund a defense build-up and a ludicrously expensive border wall. Among the big losers would be wastewater treatment programs, the highway trust fund, and maintenance in our national parks.

Rather than press Congress for the infrastructure funding he has admitted we need, President Trump has shifted to blaming environmental regulations such as the Establishing a Federal Flood Risk Management Standard that limits building in areas likely to become flooded. Wildly exaggerating the role environmental reviews play in delaying critical infrastructure projects, his executive order would short-circuit environmental reviews of projects that could leave communities excessively vulnerable to natural disasters, destroy cherished recreational opportunities, or expose children in nearby communities to toxic chemicals. …

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Trump Wants States and Cities to Pay More for Infrastructure
Source: Daniel C. Vock, Governing, August 31, 2017

The White House envisions that a long-promised infrastructure package would streamline the federal approval process for major projects and also require states and localities to shoulder more of the financial burden for building them. It’s a shift in focus from the Obama administration, which had pledged to increase infrastructure funding but never came up with a long-term solution. … Mulvaney not only said they wanted to reduce Washington’s role in state and local projects but also offer new “incentives” to help them complete projects. “We’re trying to figure out how to use a little bit of [federal] money to generate a lot of money, to give state and locals the incentives to do stuff you might not otherwise do,” he said. …

Rebuilding Our Country Should Boost Good Jobs, Not Privatization Schemes
Source: Roxana Tynan, HuffPost, August 23, 2017
 
We’ve seen a decline in infrastructure spending the last several years, and The New York Times reports that “In 34 states, spending on government construction projects was lower last year than in 2007, adjusting for inflation. The trend has continued this year. Public construction spending in June was 9.5 percent lower than during the same month last year.”  As state budgets are cut, projects are halted. So where will this outpouring of money come from? Private investors will step in, with the promise of big tax incentives.  Companies will undoubtedly focus on projects that are the most profitable, keeping labor and supply costs down in the process, rather than on building the infrastructure that is most needed. …

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Congress must continue to block Trump plan to sell BPA

Source: Union-Bulletin Editorial Board, August 8, 2017

Late last month the U.S. House Budget Committee approved a budget resolution that rejects privatizing the transmission assets of the Bonneville Power Administration proposed by the Trump administration. A great move. The sooner this lousy proposal is dead the better it will be for Pacific Northwest residents who pay power bills — pretty much all of us. … President Donald Trump is calling for turning over the transmission network of power lines and substations owned by the Bonneville Power Administration, a federal agency that distributes most of hydropower from the Columbia and Snake rivers’ dams, to private companies. As Trump sees it, this would lower costs to taxpayers and improve efficiency. But in reality it would result in far higher rates for consumers. And putting the high-voltage grid in the hands of private investors — perhaps foreign investors — would create national security concerns. …

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Down the Mighty Columbia River, Where a Power Struggle Looms
Source: Kirk Johnson, New York Times, July 28, 2017

To ride down the Columbia River as the John Day Dam’s wall of concrete slowly fills the view from a tugboat is to see what the country’s largest network of energy-producing dams created through five decades of 20th-century ambition, investment and hubris. … Now, the Trump administration has proposed rethinking the entire system, with a plan to sell the transmission network of wires and substations owned by the Bonneville Power Administration, a federal agency that distributes most of the Columbia basin’s output, to private buyers. The idea is part of a package of proposals that would transform much of the infrastructure in the United States to a mixture of public and private partnerships, lowering costs to taxpayers and improving efficiency, administration officials said. Assets of two other big public power operators, based in Colorado and Oklahoma, would be sold, too, if Congress approves the measure.

Debates about government and its role in land and environmental policy are always highly charged. But perhaps nowhere could the proposed changes have a more significant impact than along the great river of the West — fourth largest by volume in North America, more than 10 times that of the Hudson. Privatization would transform a government service that requires equal standards across a vast territory — from large cities to tiny hamlets — into a private operation seeking maximum returns to investors. …

The Untapped Wealth of American Cities

Source: Bruce Katz and Jeremy Nowak, CityLab, August 6, 2017
 
Americans who travel abroad sometimes wonder why many of our airports are lacking in comparison to the best international airports. Or they want to know why other nations seem to do a better job with public transportation and the management of other public assets, from ports to parks. The answers we are tempted to give are that we do not invest as heavily in public infrastructure as many other nations and that a market-oriented American ethos with an entrepreneurial culture prefers private solutions (cars versus trains) to public ones. … But there’s another answer: Compared to many other nations, in the United States government has more direct control of public assets such as airports, convention centers, and transport, water and sewer systems (just to name a few). And the government does not, for the most part, manage them well, failing to leverage the market potential and value of the assets they own. Far from being broke, many cities and counties have enormous untapped wealth, which could be used to finance not only infrastructure but investments in children and other critical needs. …

There is a better way, teased out in detail and with great authority in The Public Wealth of Cities, a new book co-authored by Dag Detter and Stefan Folster, two Swedish experts in public finance. The pair have studied public asset management and are promoting a third alternative to political management or full privatization—public ownership that relies on professional, private-sector management.… The authors’ core argument is a disruptive idea in public policy that links management systems, public asset value, intelligent financing, and the proper role of politicians in a democracy. …

Infrastructure Borrowing Drops as U.S. States Await Trump Plan Details

Source: Reuters, August 6, 2017

President Donald Trump arrived in office having promised a bold $1 trillion infrastructure investment plan over 10 years for roads, bridges, airports and transit systems crumbling by the day across the United States. But nearly seven months later the administration has produced few details on the future of federal infrastructure funding, one reason why state and municipal governments have issued fewer bonds to improve roads, water systems and other projects so far in 2017. … Through July, new municipal deals to fund transportation, utilities and power projects totaled $50.7 billion, down 19.4 percent from the same period last year, according to an analysis of Thomson Reuters data. That decline outpaces a broader drop in the U.S. municipal bond market overall, with total issuance down 13.1 percent thus far in 2017 to $201.7 billion. New deals have lagged since November’s post-election selloff, when state and local governments quickly issued bonds fearing potential policy changes and rate increases by the Federal Reserve.

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Lacking White House plan, Senate focuses on infrastructure
Source: Melanie Zanona, The Hill, August 4, 2017

Amid growing frustrating that President Trump’s infrastructure package keeps getting pushed to the back burner, some members of Congress are taking matters into their own hands. A bipartisan coalition from the Senate Commerce, Science and Transportation Committee has been discussing pushing its own bill if the administration doesn’t release something by the fall. The Senate Environment and Public Works (EPW) Committee has also been gathering input with an eye on drafting an infrastructure plan this summer. And several Republicans met at the White House last week to try to get the ball rolling there on the issue.

White House: Infrastructure bill remains Trump priority
Melanie Zanona, The Hill, July 31, 2017

President Trump remains committed to working with Congress on a massive infrastructure bill, White House press secretary Sarah Huckabee Sanders said Monday. The reassurance from the White House comes as GOP leaders have signaled that the timeline for Trump’s $1 trillion infrastructure package — which has yet to be unveiled — will likely slip to next year. “The president’s been very outspoken on the need for a massive overhaul to the country’s infrastructure, and that certainly is still a priority, both legislative and in any capacity that he has the ability to carry that out,” Sanders told reporters at the daily briefing.

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Denver’s 34-year deal at DIA might be the city’s first big public-private partnership, but don’t expect it to be the last

Source: Jon Murray, Denver Post, August 13, 2017
 
Denver International Airport’s proposed $1.8 billion terminal deal is poised to launch the city into a different kind of contracting that hands over some control of a publicly owned space to private interests for decades.  Get ready: That complex, 34-year contract could be a harbinger of things to come. Mayor Michael Hancock and other city leaders see promise in public-private partnerships, which infuse both private money and management into public projects, as they prepare to build out the National Western Center with large new event venues, expand the convention center and plot big changes to the Denver Performing Arts Complex. …

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Denver wants to create an office for public-private partnerships, and City Council fears being cut out of the process
Source: Erica Meltzer, Denverite, July 28, 2017
 
Denver Mayor Michael Hancock wants to create an office within city government that will screen, vet and shepherd public-private partnerships related to major city projects, like the redevelopment of the National Western Center and the Denver Center for the Performing Arts — and other projects the city might not even have anticipated yet.  Under the proposal, City Council would get to set the broad parameters of deals, but contracts would be finalized at the administrative level.  The effort is causing major concerns among some City Council members about what authority they’ll give up if the idea goes forward. That concern is only exacerbated as they debate the contract for the Great Hall renovations at Denver International Airport, a public-private partnership that will see Ferrovial and its development partners get paid as much as $1.8 billion over a 34-year period for a $650 million to $770 million project. …

Privatization Is Changing America’s Relationship With Its Physical Stuff

Source: Brian Alexander, The Atlantic, July 12, 2017
 
… As vague as Trump’s pronouncements have been on the matter, it is clear that the general thrust behind the promised building-and-repair push involves using federal dollars as up-front investment to entice private enterprises to provide most of the financing. While Democrats announced their opposition, the general idea of increased privatization of infrastructure has had a bipartisan cast. President Obama supported a plan to create an “infrastructure bank” that would help finance so-called public-private partnerships (known, for their alliteration, as P3s), but that idea fizzled under the glare of Republican opposition. He also floated the idea of selling off the Tennessee Valley Authority. …

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Selling Back To The Public What It Already Owned: ‘Public-Private Partnership’ Shark Bait
Source: Mercedes Schneider, Huffington Post, June 12, 2017
 
Today, I read two articles centered on this idea, both of which concerned Vice President Mike Pence – and one that concerned Pence’s role in the aftermath of Hurricane Katrina.  One article also included a sprinkling of US secretary of [privatized] education, Betsy DeVos.  A major goal of corporate education reform is to deliver public education to private entities (corporations, or even nonprofits, but don’t think that an entity termed “nonprofit” cannot be a handsome money dispenser for those running the nonprofit and doling out contracts). However, the extreme-right-Republican aim does not end with public education but with delivering the operation of the entire American infrastructure to private entities.  In the end, what this entails is having private corporations front money to state and local governments in order to lease back to the public what the public already owns.

How President Trump Might Carry The Torch Of Privatization
Source: Here & Now, WBUR, May 8, 2017

… Now President Trump is poised to continue privatization and private contracting in all kinds of industries, from education to incarceration. Here & Now’s Jeremy Hobson looks at the history and politics of privatization with Donald Cohen and Shahrzad Habibi of the group In The Public Interest. …

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America’s public housing crisis may worsen with Trump budget

Source: Lawrence Vale, Associated Press, July 12, 2017
 
… As someone who has spent 25 years researching and writing about the travails of public housing in the U.S., I had this immediate thought: Could the same thing happen here?  Various commentators have pointed out that American regulations require sprinklers and do not permit the use of cladding materials with combustible plastic cores in high-rise structures.  Yet while the facades of American public housing may be less flammable, the system suffers from a toxic convergence of long-deferred maintenance, squeezed budgets and cost-cutting measures. Privatization policies, deeply rooted suspicions about the character of public housing residents and long-term inattention all threaten the capacity of stigmatized low-income families to remain in their homes. …

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Ben Carson reckons with proposed HUD budget cuts
Source: Jonathan Easley, The Hill, June 30, 2017

… Now, as HUD secretary, Carson controls the $46 billion government agency that oversees housing for the poor. President Trump’s proposed 2018 budget would cut HUD spending by $6 billion. “We will use whatever resources we have very efficiently,” Carson said. “The other thing to keep in mind is that the traditional view of HUD and government is we ride in on a white horse with a bucket of money … and go off to the next thing,” he continued. “That particular model has led us to the point where we have three to four times as many people in need of affordable housing and it’s getting worse.” Carson, who had no experience in government before becoming HUD secretary, is grappling with decisions about which programs to keep, which to shutter, and how to improve the ones that remain. …

Carson: HUD will focus on public, private sectors partnerships
Source: Mallory Shelbourne, The Hill, April 26, 2017

Ben Carson, President Trump’s secretary of Housing and Urban Development (HUD), said in a new interview that his forthcoming agenda will promote partnerships between the public and private sectors.   “The biggest tools are the partnerships — public, private, nonprofit and faith community partnerships — which allow us to leverage those federal dollars …” Carson told The Associated Press in an interview published Wednesday. …  

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Authorization To Fix The Crumbling BQE Faster Stalls In Albany

Source: Emma Whitford, Gothamist, July 12, 2017
 
Legislation that the Department of Transportation predicted could shave years and millions of dollars off of critical Brooklyn Queens Expressway repairs floundered in Albany this session, to the frustration of local politicians, policy groups, labor unions, pro-business groups, and residents who live alongside the decaying BQE triple cantilever in Brooklyn Heights. … There is a basic resistance in Albany, and upstate generally, to what is considered privatization of the state contracting process,” she added. “The main opposition comes from public service unions that are concerned about their jobs somehow disappearing or being diminished.” (“We wanted to ensure that men and women in the state workforce, who are perfectly trained and qualified to do the work, didn’t lose their jobs because of design build outsourcing,” stated Emily Cote, director of communications for the Civil Service Employees Association.) …