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.


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.

Counterpoint: How We Invest in Our Infrastructure Matters
Larry Willis, Inside Sources, July 31, 2017

Contrary to what Wall Street and some Trump administration officials are peddling, the answer cannot solely lie with upfront investments from private companies. Meeting our massive infrastructure needs will take a multipronged financial approach. Private financing can and does have a role in rebuilding our transportation system, but relying on it and using it as a substitute for robust federal investment will not meet our needs. That’s because private financing is costlier than traditional public funding and is not suitable for the vast majority of our infrastructure needs. Those who support an over-reliance on private financing push the argument that public capital is scarce, and that massive amounts of private capital are sitting idly by, ready and waiting to be invested into infrastructure projects. This is simply not true.

Trump’s Infrastructure Plan Isn’t Much of a Plan
Source: Michael Granof and Martin Luby, Fortune, July 12, 2017

President Donald Trump hasn’t fully outlined his prescription for making American infrastructure great again, but he has called for a major dose of public-private partnerships—also known as P3s. These P3s, he promises, provide “better procurement methods, market discipline and a long-term focus on maintaining assets .” That’s true enough in some cases, but P3s are no cure-all for every public project. Despite the hype, the public-private approach does not provide new funding sources to communities, nor does it work for many types of public projects. …

World Offers Cautionary Tale for Trump’s Infrastructure Plan
Source:Peter S. Goodman, New York Times, June 16, 2017

The rest of the planet bears a warning for President Trump’s plan to lean heavily on private business in conjuring a trillion dollars’ worth  of American infrastructure: Handing profit-making companies responsibility for public works can produce trouble.  In India, politically connected firms have captured contracts on the strength of relationships with officialdom, yielding defective engineering at bloated prices. When Britain handed control to private companies to upgrade London’s subway system more than a decade ago, the result was substandard, budget-busting work, prompting the government to step back in. Canada has suffered a string of excessive costs on public projects funneled through the private sector, like a landmark bridge in Vancouver and hospitals in Ontario. …

Editorial: Public Works, Private Benefit
Source: New York Times, June 9, 2017

President Trump’s infrastructure plan is turning out to be a mirage. He had talked about a $1 trillion, 10-year effort. But the White House now proposes allocating only $200 billion, which would come from cutting aid to states and localities and giving it to Wall Street investors as tax credits, which it hopes will attract $800 billion in investment for big projects that would turn a profit through tolls and user fees. … But most of the nation’s unmet infrastructure needs involve smaller projects to operate, maintain and upgrade — not only highways, but also water, sewer and other systems that are of no interest to private investors.

Donald Trump’s Infrastructure Plan Faces an Urban-Rural Divide in Congress
Source: Ted Mann, Wall Street Journal, June 8, 2017

President Donald Trump’s plan to tap the private sector to rebuild $1 trillion worth of roads, bridges and rails has encountered an early problem: geography.  The administration says it will rely on private investors to supply the vast majority of cash to support a decadelong infrastructure rebuilding effort. But members of Congress from rural areas are wary.  That is because private investors are looking for infrastructure projects that throw off steady streams of revenue, from which they derive their profits, and those tend to be found near population centers. … Support from Republicans, many who represent rural areas, will be crucial in getting a large infrastructure package through the GOP-led Congress, since many Democrats have said they would oppose efforts to rely on tolls, rather than federal aid, to pay for building projects.

Trump’s infrastructure plan: How “private” will he go?
David Van Slyke, Politico, June 7, 2017

As President Donald Trump unveils elements of his infrastructure plan this week, Democrats are attacking it as a betrayal of basic government responsibilities. This “privatization,” as they call it, would sell out rural America and allow companies to exploit public assets like roads and bridges.  But a close look at Trump’s proposal—at least what we know of it so far—reveals a plan that rests not on privatization but on public-private partnerships. The two ideas sound similar but are actually very different, and understanding the differences is critical to accomplishing Trump’s goal of modernizing and upgrading America’s infrastructure.

Opinion: Trump’s infrastructure plan is wholly inadequate. And it gets worse.
John Podesta, Washington Post, June 6, 2017

Investments should spur economic growth, job creation and business formation, stimulate socioeconomic mobility, and facilitate greater access to opportunity. Investments should also further safeguard our air and water from pollution and reduce harmful emissions. And investments should not prioritize lining the pockets of wealthy Americans and corporate chief executives. Infrastructure was ripe for bipartisan agreement. Democrats in Congress were ready to work with the president to make good on his pledge to invest $1 trillion in infrastructure. But the Trump White House has rejected building a bipartisan consensus. Instead, the administration is pursuing only Republican votes for massive privatization, increased costs to taxpayers and weakening of environmental protections.

Public-Private Projects Where the Public Pays and Pays
Source: Matthew Goldstein and Patricia Cohen, New York Times, June 6, 2017

As President Trump prepares to deliver a speech on Wednesday about infrastructure, his administration is promoting the benefits of having local governments work with private corporations to build, repair and manage the nation’s ailing roads, bridges and airports. … Yet in the United States, public-private partnerships represent a tiny fraction of infrastructure spending. On toll roads, for instance, where they have been used the most, they accounted for just 1 percent of all spending between 1989 and 2011, according to a report by the Congressional Budget Office.  And whatever the advantages of giving the private sector a stake in public works — rather than leaving the government in control — experts agree that while some public-private partnerships may result in near-term savings, there is little hard evidence that they perform better over time.

Private Toll Operators Salivate Over Donald Trump’s Infrastructure Plan
Lee Fang, The Intercept,  June 6, 2017

Investors are hoping to seize upon the $1 trillion infrastructure plan proposed by President Donald Trump to transform the nation’s highways, bridges, and tunnels into assets they can monetize by adding tolls and other user fees.  The Trump infrastructure plan, which the administration plans to roll out  this week, is centered on the idea of “asset recycling,” which refers to the process of securing new infrastructure spending by leasing the operations of existing public property to private operators.  The privatization-centered scheme has the nation’s largest toll operators salivating. Transurban, Cintra, and TransCore, three major toll operators, have retained federal lobbyists to influence the upcoming plan.

AFSCME Pres. Lee Saunders on Trump Infrastructure Plan
AFSCME Press Release, June 5, 2017

AFSCME Pres. Lee Saunders issued the following statement on President Trump’s infrastructure proposal:  “The Trump infrastructure plan isn’t an infrastructure plan at all. It’s a colossal $200 billion corporate handout, which will outsource good jobs to private interests at the expense of safety and accountability. The move to privatize the Federal Aviation Administration is one of the worst aspects of this scheme to cede control of our nation’s vital infrastructure to corporations and take power away from taxpayers. To be more effective, the FAA doesn’t need to be controlled by a private entity; what it needs is stable, secure, long-term funding.

Trump Plans to Shift Infrastructure Funding to Cities, States and Business
Julie Hirschfeld Davis and Kate Kelly, New  York Times, June 3, 2017

President Trump will lay out a vision this coming week for sharply curtailing the federal government’s funding of the nation’s infrastructure and calling upon states, cities and corporations to shoulder most of the cost of rebuilding roads, bridges, railways and waterways. … What the president will offer instead over the coming days, his advisers said, are the contours of a plan. The federal government would make only a fractional down payment on rebuilding the nation’s aging infrastructure. Mr. Trump would rely on a combination of private industry, state and city tax money, and borrowed cash to finance the rest. It would be a stark departure from ambitious infrastructure programs of the past, in which the government played a major role and devoted substantial resources to paying the cost of large-scale projects.

Trump adviser supports raising gas tax to pay for infrastructure
Source: Melanie Zanona, The Hill, May 31, 2017

One of President Trump’s advisers says he supports hiking the federal gasoline tax to help pay for new roads and bridges — a politically fraught issue that Congress has avoided for years.  Richard LeFrak, a real estate developer leading a new White House council to vet infrastructure projects, told CNBC on Wednesday that he is “in favor” of increasing the gas tax, which hasn’t been raised in over 20 years.  … A number of states have begun to raise gasoline taxes on their own, as long-term funding solutions for transportation upgrades have eluded Washington.  The White House appears to be running into familiar hurdles. The administration has yet to reveal how it plans to pay for Trump’s massive rebuilding plan, which was outlined for the first time in the president’s budget proposal last week.

Source: David Dayen, The Intercept, May 27, 2017

But the third, which was rolled out much more quietly, is no less stunning: The Saudi kingdom joined forces with a top outside adviser to Trump to build a $40 billion war chest to privatize U.S. infrastructure.  The vehicle would employ the same kind of public-private partnerships, known as P3s, the Trump administration has endorsed for its trillion dollar infrastructure plan. The deal hands over control of projects to rebuild American roads and bridges to the private sector and a foreign country.  The Saudi Public Investment Fund announced its $20 billion investment with Blackstone, the private equity giant whose CEO, Stephen Schwarzman, chairs the Strategic and Policy Forum, a key group of private-sector advisers to President Trump.

Trump Administration To Cities And States: “The Bigger The Thing You Privatize, The More Money We’ll Give You.”
Source: Donald Cohen, Huffington Post, May 26, 2017

Trump’s long-promised $1 trillion investment in America’s infrastructure turned out to be stealth privatization after all. His budget proposal, released on Tuesday, would cut existing infrastructure programs, privatize the nation’s air traffic control system—a very bad idea—and incentivize public-private partnerships.  But it actually goes further. The administration says it’s considering paying state and local governments to sell off public infrastructure.  In a process called “asset recycling,” cities, counties, and states would sell or lease assets like roads and water systems to private equity investors in exchange for cash to build new infrastructure. The federal government would pay a bonus to local governments that make the deal.  Gary Cohn, director of Trump’s National Economic Council and former president of Goldman Sachs, said, “The bigger the thing you privatize, the more money we’ll give you.”

With proposed Trump cuts, chances fade for a bipartisan infrastructure deal
Source: John Wagner, Washington Post, May 25, 2017

When President Trump took office, some otherwise deeply disappointed Democrats thought they might be able to work with him on one marquee campaign promise: pumping $1 trillion into the nation’s roads, bridges, airports and other long-neglected infrastructure. But any prospects for cooperation on that front seemed to largely evaporate this week, when Trump released a budget proposal that included deep cuts to existing infrastructure programs — angering Democrats and prompting many to question the president’s commitment to an issue he trumpeted as a candidate.

White House looks to speed infrastructure pace
Source: TIMOTHY CAMA, The Hill, May 23, 2017

….President Trump and his aides have been promising since before the inauguration that a $1 trillion infrastructure package would be coming. Transportation Secretary Elaine Chao told senators recently that the proposal is “several weeks” away.  While funding has long been a top focus of the legislation, Chao, the GOP and lobbyists say that changing or streamlining the environmental permitting process is likely to be a prominent feature of the bill…..

Trump advisers call for privatizing some public assets to build new infrastructure
Source: Michael Laris, Washington Post, May 23, 2017

The Trump administration, determined to overhaul and modernize the nation’s infrastructure, is drafting plans to privatize some public assets such as airports, bridges, highway rest stops and other facilities, according to top officials and advisers. In his proposed budget released Tuesday, President Trump called for spending $200 billion over 10 years to “incentivize” private, state and local spending on infrastructure. Trump advisers said that to entice state and local governments to sell some of their assets, the administration is considering paying them a bonus.

Why Public Control of Infrastructure Matters
Source: Wenonah Hauter and Donald Cohen, Food and Water Watch, May 18, 2017

We’ve all heard the statistics about our nation’s crumbling infrastructure and agree it needs to be fixed—the American Society of Civil Engineers estimates we need to invest $4 trillion in our infrastructure across the country. But what’s still up for debate is how improvements will be financed and who will be in control—the public, or corporations and big banks? It’s an important distinction—privatized infrastructure projects have a troubling track record.  While the Trump administration has yet to release a full infrastructure plan, all signs suggest that it will lean heavily on private capital. A policy paper released during the campaign outlined giving corporations tax credits to spur $1 trillion in private investment. Instead of receiving direct spending from the federal government, states and municipalities would see an influx of private equity takeovers of projects. This would occur through outright private ownership or “public-private partnerships,” in which corporations and banks finance, design, build and operate publicly owned infrastructure. …

‘Infrastructure Week’ Spurs Query on Trump’s Plan: Where Is It?
Source: Mark Niquette and John McCormick, Bloomberg, May 16, 2017

Leaders from business, government, organized labor and trade associations gathered in Washington for an annual week-long discussion about improving the nation’s infrastructure, with a message for President Donald Trump about his $1 trillion plan: let’s see it.  The officials urged Trump to produce his plan soon if he wants to tap bipartisan support for the improvements and start to navigate the ideological differences over how to pay for them.  “My question to the White House and Congress is this: Where is the bill?” said Richard Trumka, president of the AFL-CIO, appearing by video at an ‘Infrastructure Week’ event at the U.S. Chamber of Commerce in Washington. “It’s ‘go’ time. Bring legislation to the floor, and the labor movement will help you pass it.’ …

Trump to outline ‘vision’ for infrastructure package in coming weeks, Cabinet official says
Source: John Wagner, Washington Post, May 15, 2017

President Trump will unveil his “vision” in the “next several weeks” of an infrastructure package that relies heavily on state, local and private dollars to make good on a promised $1 trillion in new investments over the coming decade, Transportation Secretary Elaine Chao said Monday.  Trump’s pledge to rebuild the country’s roads, bridges and airports was a key campaign promise that has been on the back burner in the early stages of his presidency as he’s pursued health-care legislation and outlined a tax-cut package, both of which remain a long way from completion. …

Why We Can’t Let Trump And Congress Tax Public Infrastructure Investment
Source: Donald Cohen, Huffington Post, May 5, 2017

Last week, in true Trump fashion, the administration released “the biggest tax cut and the largest tax reform in the history of our country” in all of twelve bullet points on a single sheet of paper. So, while what the plan says is terrifying—it would overwhelmingly benefit the wealthy—we should also be worried about what it doesn’t say. In particular, the plan would eliminate “targeted tax breaks” but is explicit about saving two of them: the deductions for mortgages and charitable donations. Some believe that means Congress might eliminate the tax exemption for municipal bonds to pay for tax cuts. … Private equity investors and multinational financial firms are increasingly trying to convince local governments to take their money to build infrastructure. Through public-private partnerships, also known as “P3s,” corporations like Australia’s Macquarie and Spain’s Cintra team together to loan the public cash. They tack on a high-interest rate and often demand to operate and maintain the infrastructure and rake in revenues, like tolls and fees. The P3 industry is relatively small but they have Trump’s ear. … The president tapped DJ Gribbin, a former Macquarie executive who also once worked for Koch Industries, to advise the administration on infrastructure policy. A well-known financial market analyst recently wrote that Gribbin “brings an evangelical passion to his P3 advocacy, which can be beguiling.”

The industry says their money can help local governments build things better, faster, and cheaper, but their track record has been mixed at best. They demand a healthy return—usually charging governments 10–25% interest—making P3s a costly alternative to the 3-4% interest rate that comes with municipal bonds. Most importantly, without strong protections for the public, P3s have the potential to outsource good paying, stable public jobs and give up key aspects of democratic control. … Despite all the talk about “partnership,” what the P3 industry really wants is control so they can protect their profits. … Rebuilding our roads, bridges, and water pipes will help ensure communities are healthy, safe, and prosperous. Doing it the public way gives us a chance to address widening economic and racial inequality. Tax-exempt municipal bonds are essential to this investment. …

Gov. Jerry Brown warns labor members of Republican public works plans that might ‘enrich Wall Street’
Source: John Myers, Los Angeles Times, April 24, 2017

Gov. Jerry Brown warned on Monday that what he’s heard so far from President Trump and congressional Republicans on a major new infrastructure plan sounds more like a way of benefiting the private sector. … The governor, who thanked labor leaders for helping to wrangle votes in the Legislature for the $52-billion transportation plan approved earlier this month, sounded a note of skepticism about the notion of public-private partnerships that could be at the heart of Trump’s promise to launch a $1-trillion national effort. “Here’s what they want to do, this is the Republican idea: sell, liquidate,” Brown said, referring to what he said could be efforts to finance the effort by selling off publicly owned assets.

Cohn Says Privatizing Some Infrastructure Makes Sense (Video)
Source: Bloomberg Politics, April 20, 2017

Gary Cohn, director of the White House’s National Economic Council, comments on U.S. infrastructure during an interview at the 2017 IIF Washington Policy Summit.

Transportation Department plans new top-level spots to oversee Trump priorities
Source: Melanie Zanona, The Hill, April 18, 2017

The Department of Transportation (DOT) plans to create new top-level roles and reshuffle other positions in order to put more muscle behind two of President Trump’s priorities: infrastructure investment and modernizing the Federal Aviation Administration (FAA).   The realignment was announced during a high-level internal meeting on Tuesday, according to sources close to the meeting, with the goal of putting the agency’s top brass in charge of the president’s initiatives.

Trump wants regulations streamlined in infrastructure bill
Source: Josh Boak, Associated Press, April 11, 2017

On infrastructure, President Donald Trump wants to offer a two-for-one deal.  The Trump administration intends to propose a package of tax breaks meant to help spur $1 trillion in new spending on roads, bridges and other construction over the next decade. But as part of that bill, Trump also wants introduce measures to drastically shorten approval times for projects.  The strategy appears aimed at building support for an effort with little momentum in Congress. Democrats are critical of Trump’s focus on public-private partnerships, rather that more traditional funding, while many conservative Republicans have balked at the idea of a massive government investment. …

Why Trump’s $1 trillion infrastructure plan could wind up in a ditch
Source: Lauren Gardner, Politico, April 10, 2017

President Donald Trump is counting on his $1 trillion infrastructure proposal to produce the kind of bipartisan legislative victory that has eluded him on health care and pretty much everything else.  Instead, he’s running into familiar roadblocks: suspicious Democrats, a divided GOP and questions about the math. Trump’s plan, expected to be released as early as May, has already faced months of skepticism from some conservative deficit hawks — even though it’s likely to call for far less direct federal spending than its eye-popping price tag implies. Meanwhile, Democrats are crying foul at suggestions that the blueprint will include hefty tax breaks for private investors and a shredding of permit requirements. …

Trump considers borrowing ‘much more’ than $300 billion to fund U.S. construction projects
Source: Damian Paletta and Max Ehrenfreund, Washington Post, April 6, 2017

President Trump is considering whether to issue a tremendous amount of government debt to finance a $1 trillion investment in U.S. infrastructure, which would mark a major break from his campaign pledge to attract large amounts of private money to finance upgrades to roads, bridges, ports and numerous other things.  Trump’s new belief is that the U.S. can borrow money so cheaply now because of low interest rates that it makes sense to issue more debt to borrow the money, according to comments he made in an interview with the New York Times. He also said that an infrastructure arrangement that includes public money with private money “can be very expensive.” …

Trump Cuts Leave Bridge and Rail Projects Hanging
Source: Hiroko Tabuchi, New York Times, April 5, 2017

When President Trump pledged during the campaign to spend $1 trillion to restore America’s crumbling bridges and roads, supporters across the country cheered. A leaked list of the Trump administration’s priority projects seemed to speak to the scope of the president’s ambitions: a high-speed rail line linking Houston and Dallas; a desalination plant in Orange County, Calif.; and improvements to the Lake Pontchartrain Causeway in Louisiana, the longest continuous bridge over water in the world. Then came Mr. Trump’s budget proposal, which would slash the Department of Transportation’s spending by 13 percent, end subsidies for Amtrak’s long-distance trains and eliminate the Obama administration’s “Tiger” grant program, which has helped fund mass transit systems across the country. … Elaine Chao, the transportation secretary, has sought to quell concerns. Mr. Trump remains committed to his infrastructure initiative, which he intended to announce later this year, she said last week at an event marking the Transportation Department’s 50th anniversary. … Instead of depleting government coffers, she said, Mr. Trump hoped to “unleash the potential for private investment” through partnerships with the private sector. She has also suggested that funds for infrastructure improvements might come from more tolls on the country’s roads. …

Trump Tells CEOs He’ll Only Back Shovel-Ready Infrastructure
Source: Josh Boak, Associated Press, April 4, 2017

Trump and several of his top aides emphasized plans to cut red tape and jumpstart infrastructure projects at Tuesday’s meeting, while also previewing for the CEOs other priorities that include shortening flight times for airplanes, increasing the power grid’s efficiency and targeting programs to improve job training. At one point the president had an aide come on stage to hold up a long scroll of the government’s approval process for building a highway. The president then pledged to eliminate more than 90 percent of the regulations involved and “still have safety.” He provided no details. The administration has committed to directing as much as $1 trillion for infrastructure over the next decade, although it has yet to release policy specifics. Transportation Secretary Elaine Chao recently said she expects a plan will be unveiled later this year. …

Trump to unveil $1 trillion infrastructure plan in 2017: official
Source: David Shepardson, Reuters, March 30, 2017

U.S. Transportation Secretary Elaine Chao said the Trump administration would unveil a $1 trillion infrastructure plan later this year, but she did not offer details of funding for projects. Chao said at an event at the department’s headquarters that the infrastructure initiative would include “a strategic, targeted program of investment valued at $1 trillion over 10 years. The proposal will cover more than transportation infrastructure, it will include energy, water and potentially broadband and veterans hospitals as well.” Chao’s comments were the most detailed timetable from the administration about its plans to unveil a plan to modernize U.S. roads, bridges, airports, electrical grid and water systems. Chao said the administration plans to offer incentives for public-private partnerships rather than simply fund improvements.

Trump requests — and receives — this infrastructure list from builders union
Source: Lindsay Wise and Stuart Leavenworth, McClatchy, March 27, 2017

Labor unions representing construction workers have sent an infrastructure priority list to President Donald Trump at his request, as his White House searches for projects to greenlight that require little if any federal funding. North America’s Building Trades Unions sent the White House the wish list of 26 projects, including more than $80 billion worth of energy transmission lines, water and wind projects, and pipelines across the country. …

Infrastructure Quietly Coming to Boil, Unions Head Says
Source: Elliott T. Dube, Daily Labor Report, March 16, 2017 (Subscription Required)

A “tremendous” amount of behind-the-scenes activity is taking place to propel President Donald Trump’s infrastructure plan forward, the president of North America’s Building Trades Unions told Bloomberg BNA. Trump probably will move infrastructure to the forefront of priorities after dealing with health-care reform and potentially tax reform, NABTU President Sean McGarvey said March 15. Meanwhile, the National Economic Council has gotten some “real quality people in place and on board” for launching an infrastructure program and is still filling key positions, he said. Outside experts are “putting white papers and policy positions together” to share with officials who will directly shape the program, he said. …

Trump advisers see arbitration as way to speed infrastructure plans
Source: Herbert Lash and Luciana Lopez, Reuters, March 14, 2017

A group advising U.S. President Donald Trump on infrastructure has proposed an arbitration-style pilot program to slash the current 10 years it often takes to break ground on projects, without short-changing environmental standards.  The group, led by billionaire New York real estate developers Richard LeFrak and Steve Roth, made the suggestion to Trump and others in the White House last week, LeFrak told Reuters on Monday.  Builders, unions and others often rue a permitting processes that can last a decade or more – a potential snag in Trump’s plan to launch a 10-year, $1 trillion infrastructure building program to create jobs and bolster the world’s biggest economy. … LeFrak also said the committee wants to use private funds to soak up cost overruns and keep projects maintained after completion. …

Infrastructure grants could be on chopping block in Trump budget
Source: Melanie Zanona, The Hill, March 12, 2017

Infrastructure grant programs are expected to be on the chopping block in the White House budget, according to one GOP senator, despite President Trump’s promise to revitalize U.S. roads, bridges and airports.  The administration is putting together a separate $1 trillion package to upgrade the nation’s crumbling infrastructure through public and private financing.  But the optics of slashing federal transportation funds in his budget proposal while pushing for a separate financing package underscores Trump’s challenge of balancing his promises of massive infrastructure investment and dramatic cuts in government spending. …

Trump activates $1 trillion infrastructure plan, but challenges mount
Source: Damian Paletta, Chicago Tribune, March 8, 2017

President Donald Trump’s pledge to create a program that funds $1 trillion in new infrastructure programs has kicked off with numerous meetings but few firm decisions, beset by understaffing, bureaucratic challenges and major questions about how to pay for everything.  Trump promised in a February speech to Congress that a $1 trillion infrastructure rebuilding plan would create “millions of new jobs,” but few of those jobs are expected to materialize this year because no firm deadlines have been set and much of its work could spill into 2018. … Trump has said he wants the financing to be a combination of public and private money. This could include tax credits for developers, toll projects, and government payments to private developers who issue debt to finance specific projects, among other things, a senior administration official said. No decision has been made on whether there will be a uniform funding plan or whether the White House will pursue different funding models for different projects, the senior administration official said, speaking on condition of anonymity because the deliberations are private. Potentially complicating matters, Trump has said the infrastructure plan must be revenue neutral, meaning it cannot add to the federal debt. That means even if the government pays $200 billion of the $1 trillion package, it must find a way to raise revenue or cut cost elsewhere to offset the pricetag. …

Opinion: Trump’s infrastructure plan could run into a big problem: Democracy
Source: Charles Lane, Washington Post, March 2, 2017

Depending on the details, many Democrats will support a Trump-backed infrastructure bill, in the name of boosting short-term job creation and long-term economic productivity.  There’s just one catch: Many of the same people who tell pollsters they want to unleash the bulldozers will sing a different tune when those machines approach their communities. And America’s responsive, democratic political system, with its decentralized institutions and multiple “veto points,” will heed the cry of “NIMBY” — not in my back yard. … We should also reflect on the real reasons it’s so difficult to take billions in infrastructure money, and “throw it up against the wall and see if it sticks,” as Trump adviser Stephen K. Bannon has recommended.  Under our system, the government has to consult with the people — multiple times and in multiple forums — before irreversibly damming our rivers or excavating our towns.

White House Says It Will Kick Off Infrastructure Planning Thursday
Source: Mark Niquette, Bloomberg, March 1, 2017

President Donald Trump’s administration will convene a meeting of at least 15 federal agencies Thursday as a first government-wide step toward crafting the president’s $1 trillion infrastructure initiative, a senior White House official said. Gary Cohn, director of the National Economic Council, will lead the meeting, which will focus on identifying new projects that would boost the economy; finding existing projects, such as the Keystone XL pipeline, that could be expedited; targeting policies, outdated rules and laws that could delay projects; and developing funding and financing options, the official said. …

Business, unions ramp up campaign for U.S. infrastructure spending
Source: Luciana Lopez, Reuters, February 28, 2017

… Trump promised often during his campaign last year he would seek a trillion-dollar infrastructure program to create jobs and fix crumbling airports, bridges and roads, and he said Monday he planned to raise the issue in an address to Congress Tuesday night.  However, infrastructure spending is fighting for space on Congress’s agenda with immigration, taxes, overhaul of the Affordable Care Act and a Supreme Court nomination.  Against that backdrop, unions and business groups are setting aside their differences on a host of issues to work together to revive momentum for substantial infrastructure spending.  Infrastructure spending is one issue where Democratic union leaders, Republican business executives and the Trump administration share common ground. …

Despite Trump’s Infrastructure Pledge, Governors Expect Little Federal Spending
Source: Stuart Leavenworth, Governing, February 28, 2017

President Donald Trump said again Monday that he was preparing to spend big on infrastructure. But even as he spoke, administration officials and congressional leaders were telling governors to expect little new federal investment in roads, bridges, transit systems, dam repairs and other water works.  Instead, the administration and congressional leaders plan to take a more incremental approach of spurring public-private partnerships _ such as toll roads _ by loosening environmental reviews, removing other red tape and possibly approving new tax credits. While some governors say private projects will provide little help in repairing their aging infrastructure, others say they will be forced to embrace the fiscal reality. …

Editorial: Missing: Donald Trump’s Trillion-Dollar Infrastructure Plan
Source: New York Times, February 27, 2017

Which of Donald Trump’s many campaign promises would bring real benefits to the economy? Which would almost certainly win support even among people who voted against him? And which seems to have disappeared completely from the White House radar?  The answer to all three questions is Mr. Trump’s pledge to put his self-described talents as a builder to work by spending $1 trillion on restoring the country’s crumbling bridges, potholed roads, rust-bucket trains and shabby-not-chic airports. More than a month into his presidency, no such plan has emerged, and there are no signs that one is coming anytime soon. … It was never quite clear what Mr. Trump even meant by a $1 trillion plan. During the campaign he seemed to suggest that the government would spend that much money on fixing roads, railroads and the like. But two important supporters — Wilbur Ross, soon to be secretary of commerce, and Peter Navarro, an economics professor who now heads a trade council for the president — published a white paper in October proposing tax credits to private developers, a plan more likely to provide a windfall for projects that would be built anyway. The credits wouldn’t spur needed investment in water systems, mass transit and other infrastructure that are public utilities, not vehicles for private profit. …

Trump, Congress may punt on infrastructure until 2018: report
Source: Melanie Zanona, The Hill, February 23, 2017

President Trump and GOP leaders are reportedly considering punting on a major infrastructure package until 2018, as Congress wrestles with a crammed legislative calendar this year. Republican lawmakers on Capitol Hill had already acknowledged that Trump’s rebuilding plans likely wouldn’t take shape until after his first 100 days in office, despite Trump’s pledge to deliver a proposal to Congress within his first 100 days as president. GOP sources told Axios on Thursday that a new “backup plan” is developing that would push off a massive infrastructure bill until next year, when vulnerable Democrats may be more willing to work with Trump on delivering transportation investments to their districts before the midterm elections. …

Trump’s infrastructure tax credits—Lasting legacy or private sector giveaway?
Source: Elaine Buckberg, Bloomberg Government, February 22, 2017

President Trump appears determined to make good on campaign promises, and in his inaugural address he committed to “transform America’s crumbling infrastructure.”  The need to invest in our nation’s infrastructure is a rare area of bipartisan agreement.  Will President Trump, like Presidents Franklin Delano Roosevelt and Dwight D. Eisenhower, leave a legacy of infrastructure investments that transform our economy?  The infrastructure plan authored by Trump’s nominee for Commerce Secretary, Wilbur Ross, and White House National Trade Council head, Peter Navarro, calls for $137 billion in tax credits for private-equity investments in infrastructure.  The Trump proposal provides no upfront cash, just a tax benefit for private investors—departing from longstanding federal policy of giving states and municipalities money to build infrastructure.  Yet the authors argue that the tax credits would stimulate $1 trillion in infrastructure investment. Beyond those provisions, the plan provides few details. Whether the Trump tax credits will leave a legacy of economically important projects or simply subsidize private investments with little public benefit at taxpayer expense will depend on the answers to some critical questions. … If the Trump Administration funds infrastructure with tax credits, allocating them wisely for the public benefit is the best way to ensure that the Trump era will leave behind a meaningful legacy of infrastructure investments. Failing to do so would instead let taxpayers subsidize $1 trillion in private energy and construction projects with little public benefit.

Tapping Private Sector for Roads and Bridges Poses Hurdles for Trump
Source: Mark Niquette and David Carey, Bloomberg, February 13, 2017

…But even as President Trump vows to steer more private money toward improving U.S. roads, bridges and airports, familiar impediments may hinder investors. … Fund executives say they hope for more U.S. investment opportunities. But problems that dogged former President Barack Obama’s attempt to jumpstart infrastructure spending haven’t vanished: Lengthy planning and permitting processes limit the projects that are ready for investment, fund managers say. Also, many lack a ready stream of revenue, like tolls, to make them work as investments. At the same time, there’s little existing framework for deals with states and municipalities, which own much of the infrastructure and approve projects. Only 38 states, the District of Columbia and Puerto Rico have enacted legislation facilitating public-private partnerships for some infrastructure projects, according to the National Conference of State Legislatures. That means the federal government needs to step in with incentives for governments to work with the private sector and for arrangements such as “asset recycling,” in which a public facility is privatized and the proceeds are used for other projects that lack funding, said Tom Osborne, executive director at IFM Investors in New York. … But asset recycling has detractors. Canada’s largest union for public employees has warned the employees could see wages cut. In the U.S., some cities and states have balked at the prospect of losing public control of infrastructure. …

Senate Panel Told P3s Won’t Work for Rural Areas, Tax-Exempts Are Key
Source: Lynn Hume, Bond Buyer, February 8, 2017

Municipal bonds are a “crucial component” of any infrastructure plan and their tax-exempt status must be preserved, a county official from Oklahoma representing the National Association of Counties told members of a Senate committee on Wednesday. Transportation officials from rural states said during the hearing held by the Senate Environment and Public Works Committee that public-private partnerships won’t work for them. The hearing was on “Modernizing our Nation’s Infrastructure.”… She pointed out that two thirds of the nation’s 3,069 counties are considered rural with a combined population of 60 million and face challenges such as declining populations and a limited ability to raise revenue for capital projects. Among her recommendations were that Congress should make federal highway dollars available for locally owned infrastructure. Local governments own 78% of the nation’s road miles, including 43% of federal-aid highways and 50% of the National Bridge Inventory, she said. … P3s would be unlikely to attract investors even with tax credits, he said. Part of the problem is that roads in rural states tend to have relatively low traffic volumes, he said. …

House begins quest for funding for Trump’s infrastructure plan, but is it ‘same rhetoric’ as always?
Source: Ashley Halsey III, Washington Post, February 1, 2017

Congress, and particularly the House Transportation Committee, has for years lamented the deterioration of roads, bridges and transit systems without finding significant new funding to repair them. Now, as the 115th Congress debuts, with Republicans in control of both chambers and the White House, the question reoccurs. … Trump campaigned on a promise of a $1 trillion investment in infrastructure, presenting a white paper that said he would grant an 82 percent tax credit to lure investors to commit to private-public ventures. None of the corporate chief executives called before the committee Wednesday said they thought sufficient private money would surface to meet the need. … Finding any additional revenue, let alone the $3.7 trillion estimated to meet infrastructure needs by 2020, has been the congressional challenge since the existing source, the gas-tax-funded Highway Trust Fund, began to run below meeting the need. The funding for the current transportation bill was bolstered in 2015 from sources described Wednesday as “gimmicks” and “funny money.” …

EXCLUSIVE: Trump team compiles infrastructure priority list
Source: Lynn Horsley, Steve Vockrodt, Walker Orenstein, and Lindsay Wise, The Kansas City Star and McClatchyDC, January 24, 2017

President Donald Trump’s team has compiled a list of about 50 infrastructure projects nationwide, totaling at least $137.5 billion, as the new White House tries to determine its investment priorities, according to documents obtained by McClatchy’s Kansas City Star and The News Tribune. The preliminary list, provided to the National Governor’s Association by the Trump transition team, offers a first glimpse at which projects around the country might get funding if Trump follows through on his campaign promise to renew America’s crumbling highways, airports, dams and bridges. The governor’s association shared that list with state officials in December. The group told the officials the projects on that list were “already being vetted.” Among the projects could be a new terminal for the Kansas City airport, upgrades to Interstate 95 in North Carolina and a proposal to replace the nation’s radar-based air traffic control system with one called NextGen, based on satellites. Another more detailed document obtained by the Star, circulated within the congressional and business communities, proposes funding an almost identical list of 50 projects as public-private partnerships, with half the money coming from private investment. According to a senior congressional aide, the Trump team put together the priority list of “Emergency & National Security Projects.” It includes cost estimates and job impact numbers. It is not clear whether that document is a draft or a final version. …

Most Americans don’t want new tolls to pay for road and bridge improvements, poll says
Source: Ashley Halsey III and Scott Clement, Washington Post, January 17, 2017

A plan to pump up to $1 trillion into infrastructure by luring private investors won’t win public support if it means new tolls on existing roads and bridges, according to a new poll. In Washington Post-ABC News poll, 66 percent of those surveyed said they oppose a plan that would grant close to $140 billion in tax credits to investors who put their money into roads, bridges and transit in return for the right to impose tolls. While the survey question made no mention of the incoming president, prior to the election Donald J. Trump proposed giving private investors an 82 percent tax credit to put money into projects, credits that theoretically would reduce their need to profit from the investment. Trump said his plan would lead to up to $1 trillion worth of new projects. He said the more than $137 billion cost of the tax credit would balance out because tax revenue would be recouped by taxing the wages of people put to work on the projects and from taxes paid by contractors hired to do the work. But even with tax credit incentives, investors are unlikely to put their money into projects that don’t provide a revenue stream, most likely in the form of tolls on roads and bridges. …At her confirmation hearing last week, Trump’s nominee to head the Department of Transportation, Elaine L. Chao, addressed the issue of where funds will be found for infrastructure investment. … The thinking of Trump and Chao may be augmented by a new panel the president-elect is planning to review how the $1 trillion he expects to raise will be spent. In an interview with the Wall Street Journal on Friday, Trump said he plans name two real estate developers — Steven Roth and Richard LeFrak — to head the new panel. …

Outgoing Transportation Secretary Says Private Funding Isn’t the Answer
Source: Joan Lowy and Jonathan Lemire, Associated Press, January 17, 2017

Stimulating private investment in infrastructure projects, as President-elect Donald Trump has proposed, can cover only a fraction of the costs of solving America’s transportation problems, Transportation Secretary Anthony Foxx warned as he prepares to leave office. Financing schemes called public-private partnerships, which involve both government dollars and private capital, are useful and can address about to 10 percent to 20 percent of America’s transportation “deficit,” Fox said in an interview this week with The Associated Press. “But we’re still going to need a fair amount of public funding,” he said. “I don’t see public-private partnership as a 100 percent strategy to solve our transportation problems.” Such partnerships typically rely on revenue from tolls or sales taxes dedicated to that purpose to provide investors with a profit. Major transportation projects financed by public-private partnerships have had a mixed record in the U.S. Several private toll roads have gone bankrupt, but express toll lanes on major highways constructed in part with private capital have had more success. … Trump’s nominee for transportation secretary, Elaine Chao, said at her Senate confirmation hearing last week that she wants to “unleash the potential for private investment.” … Foxx agreed that “there is a lot of private capital sitting on the sidelines today not being as productively put to use as it could be.” He said the Obama administration has laid the groundwork for more private investment through the creation of its Build America Bureau inside the Transportation Department. The bureau is designed to be a one-stop destination for help dealing with federal regulations, applying for aid and accessing useful information. But Foxx also cautioned that “you could put $5 trillion into America’s transportation system and if the money isn’t directed in the right way, we will still have congestion, still have problems.” …

Donald Trump Supports Using Federal Funds To Fix States’ Bridges And Roads, Elaine Chao Says
Source: Igor Bobic, Huffington Post, January 11, 2017

President-elect Donald Trump supports using direct federal spending to fix the nation’s crumbling infrastructure system, according to his pick for transportation secretary. Sen. Cory Booker (D-N.J.) asked Elaine Chao during her confirmation hearing on Wednesday whether she and Trump supported a plan to fix America’s roads and bridges that included “direct federal spending.” “I believe the answer is yes,” Chao said. Trump has said he intends to invest $1 trillion to fix the nation’s infrastructure ― a tall order considering the deficit-averse conservatives in Congress. Senate Majority Leader Mitch McConnell (R-Ky.), Chao’s husband, has continually blocked additional infrastructure funding proposed by the Obama administration. Democrats are concerned that Trump’s plan would mostly consist of tax breaks to private-sector investors who invest in infrastructure projects. Critics say such deals often leave state and local governments to foot the bill. … During her testimony, Chao indicated her support for such public-private sector partnerships. “It is important to note the significant difference between traditional program funding and other innovative financing tools, such as public-private partnerships. . . . It’s also important to recognize that the way we build and deliver projects is as important as how much we invest,” Chao said. But she was noncommittal about the issue during questioning, telling the committee that public-private partnerships were “embraced by some.”

The Trump administration says it has to have private help to fund roads and bridges. It’s wrong.
Source: Timothy B. Lee, Vox, January 11, 2017

On the campaign trail, Donald Trump touted plans for $1 trillion in new infrastructure spending. Rather than paying for this directly using tax dollars or government borrowing, he has proposed largely relying on private companies to raise the necessary funds, incentivized by tax credits. At a Senate hearing today, Trump’s choice for transportation secretary, Elaine Chao, touted the advantages of this approach. Chao vowed to “unleash the potential for private investment in our nation’s infrastructure” using public-private partnerships. “In order to take full advantage of the estimated trillions in capital that equity firms, pension funds, and endowments can invest, these partnerships must be allowed to participate with a bold new vision,” she said. “We all know that the government doesn’t have the resources to do it all.” Chao is wrong. The federal government does have the resources to “do it all.” And the costs of infrastructure spending ultimately fall on taxpayers and motorists whether or not financing is provided by private companies. … The way public-private partnerships are usually structured is that a private company puts up money at the beginning and in exchange is entitled to a flow of payments. The company might get the right to collect tolls on a newly constructed road. Or the company might be entitled to fixed, taxpayer-funded payments for use of the road. Either way, the private company is effectively lending the government money and getting paid back over time using taxpayer dollars. And because the company hopes to turn a profit on the deal, the value of these payments is likely to be higher than the interest payments the government would have paid if it had financed the work directly.

Elaine Chao: Unleash Private Investors to Boost Transportation
Source: Joan Lowy, NBC Bay Area, January 10, 2017

The Trump administration is looking to “unleash the potential” of private investors to boost the national transportation networks that underpin the U.S. economy, transportation secretary-designate Elaine Chao plans to tell lawmakers Tuesday.  Economic gains are being jeopardized by infrastructure “in need of repair, the specter of rising highway fatalities, growing congestion, and by a failure to keep pace with emerging technologies,” according to prepared testimony Chao is scheduled to deliver at a hearing of the Senate Commerce, Science and Transportation Committee. Chao emphasized a significant difference between traditional program funding and “innovative financing tools” that can “take full advantage of the estimated trillions in capital that equity firms, pension funds, and endowments can invest.” She added that private investment should be “incentivized with a bold, new vision.”  While her testimony doesn’t detail those incentives, a white paper released by President-elect Donald Trump’s campaign shortly after the election proposes the government provide $137 billion in tax credits to infrastructure investors. The paper’s authors — billionaire investor Wilbur Ross, whom Trump has picked to be commerce secretary, and economics professor Peter Navarro, Trump’s choice to head the National Trade Council — estimate the tax credits will generate an estimated $1 trillion in private sector investment over 10 years. …

Public Infrastructure as Stealth Privatization
Source: Donald Cohen, American Prospect, December 20, 2016

Donald Trump hasn’t released an infrastructure plan but has given a good sense of the direction his administration will take.  His proposal will likely use giant tax breaks to spur a massive increase in private control of public infrastructure in what David Dayen called a “privatization fire sale.” Trump will be able to say the plan will both mean no new taxes and guaranteed profits for investors for decades.  It’s too good to be true. There’s no doubt America needs a massive infrastructure upgrade. The American Society of Civil Engineers estimates nearly $4 trillion in needs including decades of deferred maintenance of our drinking and waste water systems, our roads and bridges and more, as well as new infrastructure such as light rail and broadband communications needed respond to 21st century challenges and opportunities. The battle in D.C. will be over four things: Whether and how much we decide to invest in public infrastructure at all, how we pay for it, where investments are focused, and who controls it—private investors or public interests.

Why Privatizers Look Forward to 2017
Source: Donald Cohen, Capital & Main, December 17, 2016

“We’re just going to throw it up against the wall and see if it sticks.” That’s what Steve Bannon, Donald Trump’s chief strategist and cofounder of the website Breitbart, said a few weeks ago about Trump’s plan to rebuild America’s infrastructure. That pretty much fits with what we know so far. Trump wants to “invest” $1 trillion in fixing and building roads, bridges, water pipes and other infrastructure. But by “invest” he means using massive tax breaks to convince private investors to spend the money. … America must invest in rebuilding our infrastructure for the 21st century, but we need to do it right. Doing it right means keeping public control, protecting taxpayers, creating good jobs in an increasingly unequal economy, and addressing climate change. Trump’s plan would lean heavily on the private sector through “public-private partnerships” (P3s). At In the Public Interest, we’ve found that, without protections, P3s hand control of our infrastructure to private investors or cost us more in the long run—or both. … With P3s, the devil is in the details, and we’ve produced resources to help with those details:

  • P3s have the potential to create middle-class pathways for those left out of the economy, but only if they include policies regarding job quality and equity. Here are the best practices to do just that.
  • P3s must include democratic control, real community input and transparency, and create good paying jobs. Here’s the process, from enabling legislation to contract language, to make that happen.
  • Sometimes P3s are used to lease or “sell off” public assets like parking meters and buildings. These deals can lead to loss of control, higher user fees, job loss and future budget issues if we don’t ask these tough questions.

Trump’s infrastructure plan is a privatization trap
Source: Donald Cohen, Huffington Post, December 8, 2016

America must invest in rebuilding our infrastructure for the 21st century, but we need to do it right. Doing it right means keeping public control, protecting taxpayers, creating good jobs in an increasingly unequal economy, and addressing climate change. Trump’s plan would lean heavily on the private sector through “public-private partnerships” (P3s). Without protections, P3s hand control of our infrastructure to private investors or cost us more in the long run—or both. Chicago learned the hard way in the midst of the recession, leasing its parking meters to Wall Street for $1 billion under value. Texas did too when the private investors in a toll road between Austin and San Antonio went bankrupt earlier this year, leaving taxpayers to clean up the mess. With P3s, the devil is in the details. … They must include democratic control, real community input, and transparency, and create good paying jobs. P3s must create opportunities for everyone, not just the few. Sometimes P3s are used to lease or “sell off” public assets like parking meters and buildings. These deals can lead to loss of control, higher user fees, job loss, and future budget issues if we don’t ask tough questions. …

How To Fix The Trump Infrastructure Plan
Source: Joel Moser, Forbes, November 27, 2016

The Trump plan is essentially a tax break for private investment in infrastructure. The criticism generally follows two themes: 1) that it is a privatization scheme and 2) that mere tax breaks won’t create much new infrastructure since most civil infrastructure in the United States isn’t revenue producing and so is unsuitable for private investment which requires, by definition, a return on investment. Were the tax breaks to be used to privatize existing revenue producing infrastructure (as non-revenue producing assets would be of no interest to investors), that would essentially be an off-balance sheet financing scheme by the government—the city, county, state or other unit in question—and the prudence of such a transaction would turn on the adequacy of amount of the proceeds and what the proceeds are to used for: new infrastructure, tax abatements, deficits? There are good and bad ways to privatize assets and good and bad deals for the public. … In this regard, the fears of privatization may be overblown. Let’s see the details of the plan. The second issue, however, is a show-stopper. No amount of tax break will encourage investment in an asset that doesn’t produce revenue. No one will invest in the replacement of defective bridges that have no tolls, regardless of the tax abatement, unless a revenue stream is attached to those assets. …

Infrastructure Build or Privatization Scam?
Source: Paul Krugman, New York Times, November 19, 2016

Trumpists are touting the idea of a big infrastructure build, and some Democrats are making conciliatory noises about working with the new regime on that front. But remember who you’re dealing with: if you invest anything with this guy, be it money or reputation, you are at great risk of being scammed. So, what do we know about the Trump infrastructure plan, such as it is? Crucially, it’s not a plan to borrow $1 trillion and spend it on much-needed projects — which would be the straightforward, obvious thing to do. It is, instead, supposed to involve having private investors do the work both of raising money and building the projects — with the aid of a huge tax credit that gives them back 82 percent of the equity they put in. To compensate for the small sliver of additional equity and the interest on their borrowing, the private investors then have to somehow make profits on the assets they end up owning. … First, why involve private investors at all? It’s not as if the federal government is having any trouble raising money — in fact, a large part of the justification for infrastructure investment is precisely that the government can borrow so cheaply. Why do we need private equity at all? … Second, how is this kind of scheme supposed to finance investment that doesn’t produce a revenue stream? Toll roads are not the main thing we need right now; what about sewage systems, making up for deferred maintenance, and so on? You could bring in private investors by guaranteeing them future government money — say, paying rent in perpetuity for the use of a water system built by a private consortium. But this, even more than having someone else collect tolls, would simply be government borrowing through the back door — with much less transparency, and hence greater opportunities for giveaways to favored interests. Third, how much of the investment thus financed would actually be investment that wouldn’t have taken place anyway? That is, how much “additionality” is there? Suppose that there’s a planned tunnel, which is clearly going to be built; but now it’s renamed the Trump Tunnel, the building and financing are carried out by private firms, and the future tolls and/or rent paid by the government go to those private interests. In that case we haven’t promoted investment at all, we’ve just in effect privatized a public asset — and given the buyers 82 percent of the purchase price in the form of a tax credit. …

Trump promises big on highway funding, could open door to more tolls and privatization
Source: James Jalliet, Overdrive, November 14, 2016

President-elect Donald Trump said throughout his campaign for the White House that he wants major investments in U.S. infrastructure, calling for $1 trillion on infrastructure projects during his presidency. … However, major infrastructure bills are challenging pieces of legislation to pass, especially since Congress changed little in the election, says Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association. “Pretty much all the same players are still there,” he says. … Trump says he would incentivize private businesses to invest in infrastructure projects by offering them tax incentives. Such privatization of U.S. roads could lead to more tolls, Spencer says. “The closest Trump came to suggesting how things might be paid for is through privatizing. That sounds good to the financial community but it generally doesn’t play out that well on Main Street — it simply means more tolls,” he said. OOIDA is “open to sustainable funding that’s fair to highway users. The tried and true mechanism of paying for roads and bridges is through fuel taxes. If that’s ruled out, the dilemma gets bigger and harder to resolve.” …