Utility Contractor

MAR-APR 2018

As the official magazine of NUCA, Utility Contractor presents the latest information affecting every aspect of the utility construction industry, including technological advancements, safety issues, legislative developments and instructional advice.

Issue link: http://digital.utilitycontractoronline.com/i/947577

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Page 31 of 43

32 Utility Contractor | March/April 2018 Trump's Infrastructure Plan Comes into Focus INSIDE WASHINGTON W hile we got a sneak peak of President Trump's proposed infrastructure plan back in January, on Feb. 12, 2018, we got the full outline of the President's plan. Combined with the Presi- dent's budget, which was released the same day, it has be- come clear where the White House's focus, in terms of an infrastructure plan, has been directed. The plan released by the White House focuses on four primary funding objectives for building infrastructure: in- centive grants, rural infrastructure grants, transformative projects, and current program reforms. Additionally, the plan contains an added workforce development compo- nent to address the potential employment needs associated with increased infrastructure investment. The plan calls for an investment by the federal government of $200 bil- lion which will, once leveraged with additional financing mechanisms, provide at least $1 trillion in infrastructure investment. The first and largest component of the White House's plan is incentive grants. Under the proposal, the U.S. De- partment of Transportation, the Army Corps of Engineers, and the EPA would administer the allocation of incentive grants to applicants to provide the final financing com- ponent needed for the project to move forward. In other words, potential recipients will apply for funding for proj- ects that already have a substantial portion of the project financed. Applications will be assessed based on a weight- ing system that includes the dollar value of the project, evidence of sustainable, non-federal, and long-term fund- ing for both the project's construction and the upkeep and maintenance after completion, and efficiency and opera- tional improvements. Successful projects cannot receive grants of more than 20% of total project costs and no state can receive more than 10% of available funds. Adhering to the President's budget, this program would receive $100 billion in funding. Second, grants for rural areas will support rural ar- eas without the financial resources, credit worthiness, or tax base to build infrastructure. Acknowledging that the White House's own formula, which weighs size and cost in determining grant awards, disadvantages rural areas in competition for incentive grants, the rural grant program will provide block grants to states based on a ratio of ru- ral population and rural road-miles that has not yet been revealed. Eighty percent of the $50 billion allocated ($40 billion) will be used for these block grants while the re- maining 20 percent would be reserved for "performance grants" to states that prove to be good stewards of their block grant allocation with a preference to those states that prove most effective at leveraging funds from existing fed- eral programs. The third component to the President's infrastructure plan is the transformative project program. The Depart- ment of Commerce would be in charge of administering this program to provide "bold, innovative, and transfor- mative infrastructure projects that could dramatically im- prove infrastructure." These types of projects are capable of generating revenue, but may have a difficult time secur- ing private investment due to the size, innovation, risk, or degree of proven applicability. Federal money for these projects can be used for trial demonstration, project plan- ning, and capital construction with escalating maximum allocations. Think of these sorts of projects as a new use of technology, building method, or infrastructure that would provide significant positive impact on the nation, state, and/or metropolitan area. The White House suggests these types of projects will support and incentivize research and development in infrastructure. Finally, reforming and changing the scope of existing federal programs round out the infrastructure plan. $14

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