President Donald Trump’s infrastructure plan released Monday sets forth a grant incentive program that aims to attract “significant new, non-Federal revenue streams” and to spur use of “new and rapidly evolving infrastructure technology to improve cost and improve performance,” making grant recipients “accountable for achieving specific, measurable milestones.”
The $100 billion program would apply to “wide-ranging classes of assets,” including surface transportation and airports, ports and waterways, and funds would be divided in “specific amounts” to be administered by the Transportation Department (DOT), U.S. Army Corps of Engineers, and Environmental Protection Agency, the plan says. Those agencies could be petitioned by other agencies to transfer incentives.
Each “lead federal agency” would solicit grant applications “as soon as practicable” after the start of the program and every six months thereafter, the plan says.
The plan sets out a detailed rubric for how agencies should evaluate applications, laying out how much weight should be applied to different elements of the petitions.
Evidence supporting how the applicant will secure “new, non-federal revenue to create sustainable, long-term funding for infrastructure investments” will be weighted at 50 percent.
Meanwhile, evidence of how the applicant will secure new, non-federal revenue for operations, maintenance and rehabilitation will hold a 20 percent weight.
Updates to procurement policies and approaches to improve project delivery will be weighted at 10 percent. Considerations of the dollar value of the project or “program of projects” will be weighted at 10 percent also.
Finally, plans to incorporate “new and evolving technologies,” and evidence supporting how the project will spur “economic and social returns on investment,” will be weighted at 5 percent apiece.
Federal agencies will calculate each “application score” by multiplying the weighted score of the evaluation criteria by the percentage of non-federal revenues – as a proportion of total revenues – that would be used to fund the project or “program of projects.”
Incentive grants wouldn’t be allowed to exceed 20 percent of new revenue generated by applied-for projects, and any individual state couldn’t receive over 10 percent of the total amount available under the incentives program, according to the plan.
Further, the lead federal agency and grant recipient would enter into an agreement setting forth progress benchmarks toward obtaining increased revenue that the recipient would have to achieve before receiving the grant, but the agreement could include advance grant disbursements.
Agreements with incomplete milestones after two years would be voided, except if the lead federal agency determines that there is “good cause” to renew the agreement for up to another year, the plan says. Voided agreement funds could be reallocated through a new application process.
The incentives program would also include a “look-back period” to ensure “applicants could receive credit” for actions that occurred before the program started.
The plan would also set aside $20 billion for a “Transformative Projects Program,” to be overseen by the Commerce Department, which “could include” the transportation and energy sectors, among others.
Among the targets of the plan is an expansion of Transportation Infrastructure Finance and Innovation Act (TIFIA) funding.
One of the ways to expand funding would be in supporting airport and non-federal port enhancement options, according to the plan, which do not currently have access to TIFIA credit assistance that is available for other types of transportation projects.
This makes it “more difficult for project sponsors to pursue alternative project delivery for airports and to implement critical airport infrastructure improvements,” the plan states. “Amending the project eligibility in the TIFIA statute to enable TIFIA to offer loans and other credit assistance to non-Federal waterways and ports and airport projects…would incentivize project delivery for airports and ports and would accelerate overall improvements in airport and seaport infrastructure.”
The plan also seeks to expand railroad rehabilitation and improvement financing (RRIF) and broaden eligibility by giving additional budget authority to DOT for subsidy costs under RRIF, setting aside “specific funds” for the department to remain available through fiscal 2028.
The plan would add to RRIF eligibility by broadening its application to include short-line freight rail, as the current RRIF law doesn’t give specific subsidies or incentives for such projects.
The White House is proposing to amend that law, 45 U.S.C. 822, to provide a subsidy to cover RRIF credit risk premiums for short-line freight and passenger rail projects.
Because no subsidies are currently provided to cover costs of RRIF credit risk premiums, project sponsors are “always” required to pay the premiums at the time the loan is disbursed, the plan states. Costs of the credit risk premiums are often cited as one of the reasons project sponsors are reluctant to pursue RRIF financing, the plan says.
The U.S. House’s 55-member Sustainable Energy and Environment Coalition (SEEC) – co-chaired by Democrat Reps. Paul Tonko, N.Y., Gerald Connolly, Va., and Doris Matsui, Calif. – is releasing its own national infrastructure plan on Monday.
That plan highlights a broad effort to embed environmental sustainability into plans to fund national infrastructure, including ports and freight infrastructure.
The plan also includes a recognition that the historical federal commitment to fund national infrastructure projects should be maintained and strengthened, “which is definitely a contrast from the proposal that’s coming out from the administration,” according to a congressional staffer involved in crafting the SEEC outline.
Among other things, the SEEC’s plan calls for Congress to incentivize adoption of the “cleanest available technology” for rail and truck modes through grants or tax credits that can offset higher costs of low- or zero-emissions technologies. Replacing older diesel locomotives with diesel-electric Tier 4 locomotives can reduce carbon emissions 80-90 percent, for example, the plan says.
In various parts of the plan, reauthorization of the Diesel Emissions Reduction Act is mentioned as a potential policy solution to several issues related to pollution generated through normal transport/port activities.
The coalition’s plan also points to digital innovations to share information throughout the freight supply chain as a potential solution for identifying low-traffic periods, reduce idle times, and “otherwise reduce both congestion and emissions.”
The staffer mentioned that while it’s difficult to see a path by which the Trump administration/congressional GOP infrastructure plan would substantially incorporate the environmental principles laid out in the SEEC’s plan, “in any big program, if we’re creating something or changing some of the big programs, there are ways that we can try to make it so that, down the line, there remains eligibility for the type of project we would like to see.”
The staffer added, “How we started the conversation on this report, is we wanted to sort of attack the narrative that the administration is putting out there that it’s a choice between the environmental review process and the sorts of things that a lot of the green groups will advocate for around [Washington], and building highways,” for instance.
The SEEC’s plan also calls for freeing up the billions of dollars of unused funds sitting in the Harbor Maintenance Trust Fund to improve harbors and ports.
Importing and managing the logistics of your precious freight is no easy task. Compliance to U.S. Customs & Border Patrol is essential to your cargo clearing customs. Use a freight forwarder to lower your chances of having shipment delays and to oversee all of your international freight logistics. Contact a customs broker to file your ISF and issue any pre-alerts to avoid penalties and delays, and arrange your ocean freight and imports customs clearance.