Senate Vote on Bipartisan “Physical” Infrastructure Deal Expected Soon, Laying Groundwork to Consider “Human” Infrastructure on Separate Track

The Senate processed amendments this week on bipartisan legislation for hundreds of billions in new investments in the nation’s “physical” infrastructure. Majority Leader Chuck Schumer (D-NY) pushed to continue votes this weekend on the bipartisan measure – with further plans next week to separately consider an anticipated $3.5 trillion budget resolution for “human infrastructure” designed to pass with only Democratic support. (BGov, Aug. 6)

Bipartisan “Physical” Infrastructure Deal

  • The Senate’s Bipartisan Infrastructure Investment and Jobs Act ( text as of Aug. 3 | section-by-section – also known as the “Bipartisan Infrastructure Deal” (BID) – proposes $550 billion in new infrastructure investment.
  • Summaries and fact sheets from the Biden Administration break down the amounts invested in the BID’s various infrastructure categories. The bipartisan deal is estimated to create around 2 million jobs per year over the next decade.
  • The bill needs 60 votes to pass in the Senate, requiring support from at least 10 Republicans.
  • The BID includes no new tax increases. Most of its proposed “pay-fors” involve repurposing previously enacted COVID relief funds.
  • Senate policymakers struggled to complete work on the bipartisan deal this week amid concerns over taxation on cryptocurrency and yesterday’s release of a score by the Congressional Budget Office score, estimating the bill would add $256 billion to the deficit over 10 years. (Politico, Aug. 5; Wall Street Journal, Aug 6; The Washington Post, Aug. 6)

The BID, Real Estate, and Community Development

  • The Real Estate Roundtable has summarized elements of the BID of particular interest to real estate owners and community developers, that align with The Roundtable’s longstanding infrastructure policies.  [“Spending and Other Provisions Pertinent to Real Estate and Community Development”]
  • The Roundtable’s summary addresses the BID’s provisions for:
    • Billions of proposed investments in various infrastructure asset classes dedicated to roads, bridges, mass transit, high-speed rail, broadband, the power grid, water pipes, and electric vehicle charging;
    • Supporting public-private partnerships;
    • Streamlining the federal permitting process; and
    • Improving the key federal energy data that supports EPA building labels (Roundtable Weekly, July 16) 

“Human” Infrastructure Package

  • If the BID legislation is approved,  it would prompt the Senate to move to a $3.5 trillion budget plan that includes President Biden’s wide-ranging domestic priorities supporting “human infrastructure.”
  • No Republicans are expected to support the $3.5 trillion measure. Democrats must first pass a joint budget resolution to avoid a Senate filibuster, that authorizes the use of special “reconciliation” rules and sets a course for passage on a party-line vote
  • Senate Budget Committee Chairman Bernie Sanders (D-VT), above, signaled that the reconciliation package would include spending for health care, child care, education, paid family and medical leave, and affordable housing. Reconciliation is also expected to address immigration and climate change matters. ( Wall Street Journal, Aug. 3)

After Labor Day, Democratic members are expected to meet to decide on which provisions to include in the human infrastructure package, including tax increases on businesses and individuals.  

#  #  # 

Senate Advances Trillion Dollar Bipartisan “Physical” Infrastructure Deal as Democrats Push Separate $3.5 Trillion “Human” Infrastructure Package

Capitol building sun and green

The Senate on July 28 voted to advance a $1 trillion infrastructure package that would allocate $550 billion in new spending toward transit, utilities and broadband. The plan, which has not been translated into final legislation yet, was the result of a breakthrough in month-long negotiations between a bipartisan group of senators and President Biden. (White House Fact Sheet, July 28 | E&E Daily, July 29 | Roundtable Weekly, June 25) 

Historic Step Forward 

  • The Senate vote of 67-32 included the support of 17 Republicans and all 50 Democrats – and kick-started the process of debating and amending the measure, which could draw enough support to pass the Senate next week. (BGov, July 29)
  • Real Estate Roundtable President and CEO Jeffrey DeBoer yesterday stated, “The Real Estate Roundtable strongly supports the bipartisan agreement on infrastructure reached by the White House and senators this week – and we applaud the continued hard work of policymakers to work across the aisle to create legislation that will revitalize our economy and keep us globally competitive. The trillion-dollar+ infrastructure package is a positive, historic step forward. We look forward to its enactment and the well-paying jobs it will create, the economic growth it will spur on, and how it will benefit our long-term national competitiveness and productivity.” (Read DeBoer’s full statement, July 29)
  • Roundtable Chair John Fish (Chairman & CEO, Suffolk) and 11 other Roundtable members joined more than 100 business leaders in a July 26 letter to Congress that urged policymakers to pass the bipartisan infrastructure package. (The Hill, July 28)
  • The letter noted, “New jobs generated by investment in the nation’s mass transit, roads, bridges, airports, broadband and other essential assets will create training and re-employment opportunities for millions of Americans who lost jobs during the pandemic. The public-private initiatives that are created will accelerate recovery from losses suffered due to COVID-19.” (Business leaders’ joint letter, July 26) 

Infrastructure Package & CRE 

Philly evening bridge

Pay-Fors & Timing 

Sen. Chuck Schumer Hudson Yards Subway station

  • Miller & Chevalier reported on July 28 that the bipartisan plan’s wide-ranging infrastructure investments would be paid from a variety of sources, including: 
    • certain unused COVID relief dollars;
    • certain states returning unused federal unemployment insurance aid; 
    • sales of future spectrum auctions;
    • extending fees on GSEs; economic growth resulting from a 33 percent return on investment in long-term infrastructure projects; and 
    • information reporting requirements related to cryptocurrency.
  • Senate Majority Leader Chuck Schumer (D-NY), above, would need 60 votes in the upper chamber to avoid a Republican filibuster and pass the Bipartisan Infrastructure Investment and Jobs Act. Those votes would likely come from all 50 members of his caucus and at least 10 Republicans. (PoliticoPro, July 29)
  • “My goal remains to pass both the bipartisan infrastructure bill and a budget resolution during this work period. Both,” he said. “It might take some long nights. It might eat into our weekends. But we are going to get the job done, and we are on track.” Although the Senate’s recess is scheduled to start Aug. 9, Schumer has said he could keep the chamber in session longer to pass the measures. (New York Times, July 29)  

“Human” Infrastructure Package 

DC monuments night

  • The Biden administration’s separate $3.5 trillion “human infrastructure” plan to invest in child care, paid leave, education and measures to curb climate change is traveling along a parallel budget “reconciliation” path – a process that would require the vote of every Senate Democrat to pass the bill without any Republican votes. (CNBC, July 29)
  • Senate Budget Committee Chairman Bernie Sanders (I-VT) on July 28 said he has the 50 votes to pass a broad budget resolution next week that would lead to consideration of the package, according to Bloomberg. Sanders added, “It is my absolute conviction that you’re not going to have a bipartisan bill unless you have a reconciliation bill of $3.5 trillion.”
  • However, Sen. Kyrsten Sinema (D-AZ) – the lead Democratic negotiator on the bipartisan infrastructure bill – this week told the Arizona Republic, “I have also made clear that while I will support beginning this process, I do not support a (reconciliation) bill that costs $3.5 trillion – and in the coming months, I will work in good faith to develop this legislation with my colleagues and the administration to strengthen Arizona’s economy and help Arizona’s everyday families get ahead.” (CNN, July 28) 

In the House of Representatives, Speaker Nancy Pelosi (D-CA) has insisted she will not consider either the infrastructure bill or budget measure until the Senate passes both. (CNBC, July 29) 

#  #  #

Policymakers Claim Deal is Close on Bipartisan “Physical” Infrastructure Proposal; Roundtable Chair John Fisk Addresses Infrastructure Investment

Members of a bipartisan group of senators working on a $579 billion “physical” infrastructure proposal said Thursday that final details may be announced as early as July 26, after a procedural vote in the Senate earlier this week failed to allow debate on the evolving measure. (Bloomberg, July 22)

Bipartisan Deal

  • The bipartisan group initially announced their tentative, broad infrastructure agreement with President Biden on June 24. Remaining issues to resolve are finalizing how to pay for the package including measures affecting funding for transit systems. (Roundtable Weekly, June 25 and BGov, July 22)
  • One of the 22 Senate negotiators, Sen. Joe Manchin (R-WV), said, “We had an agreement on 99% when we walked out yesterday afternoon. The pay-fors are pretty much lined up.” (Bloomberg, July 22)
  • Another negotiator, Sen. Mitt Romney (R-UT) added, “I think we’ll get it done over the weekend, and then I hope that we get another cloture vote next week, and that will succeed.” (PolitcoPro, July 22)
  • The bipartisan proposal, if eventually translated into legislation, would need at least 10 Republican votes in the 50-50 Senate to avoid a filibuster and start debate on the measure.

Reconciliation

  • If the deal fails, Democrats may consider paring the “hard” infrastructure proposal with a separate, $3.5 trillion “human” infrastructure plan that addresses climate change, child care and health care. A combined package could be pushed through Congress as part of a budget “reconciliation” process that would bypass the need for Republican votes. (CNBC, July 22)
  • Senate Majority Leader Chuck Schumer (D-NY) on July 21 said he may delay the chamber’s August recess to pass both infrastructure packages. (Roll Call, July 21)
  • House Speaker Nancy Pelosi (D-CA) yesterday reiterated that the House will not act on the Senate’s bipartisan infrastructure plan until the upper chamber also passes a reconciliation bill.  (Transcript of July 22 press conference)

Infrastructure Investment Analysis 

CRE & Infrastructure

  • Roundtable Chair John Fish (Chairman and CEO, Suffolk), above right, on July 21 discussed infrastructure issues, the impact of the pandemic on commercial real estate and the industry’s leadership role in national policy issues with Roundtable member Willy Walker (Chairman and CEO of Walker & Dunlop), left, on the Walker Webcast. (Bisnow and Connect, July 21)
  • Fish noted that economic opportunities resulting from investments in physical infrastructure are equally as important as investment in social infrastructure. Fish noted Boston’s “Big Dig” transportation infrastructure project as an example of a large-scale public investment that returns enormous benefits for the larger community.
  • “Boston made an almost $19 billion investment with the federal government in the Big Dig, and we have received probably $100 billion in returns today so far,” Fish said. “If we didn’t make those investments in the Big Dig back in the 1990s, early 2000s, the city of Boston would not be growing the way that it is right now.” (Walker Webcast and Bisnow)

Fish also commented on The Roundtable’s role in Washington and the importance of CRE industry leadership in the climate change debate. He emphasized that the vast majority of US buildings were constructed in the last century — and that with 40% of US energy use attributable to owners, tenants, and other occupants of residential and commercial structures, now is the opportune time for the industry to reimagine its positive role for future generations. (See 34:45 in the Walker Webcast) 

#  #  #

Senate Democrats Push Forward on Two Tracks to Advance President Biden’s Infrastructure Agenda

HIghway Infrastructure Houston

Senate Democrats this week moved forward on their two-pronged approach to enact President Joe Biden’s policy agenda – a $579 billion bipartisan “physical” infrastructure package – and a separate $3.5 trillion package addressing “social” infrastructure. Both measures face steep hurdles in the narrowly divided Senate and House. (Wall Street Journal and BGov, July 15)

Two Tracks

  • Senate Budget Committee Democrats agreed in principle on Tuesday to a $3.5 trillion spending increase for Biden’s wide-ranging social agenda that includes education, childcare and climate. (Reuters, July 13 and Roundtable Weekly story below)
  • Separately, President Biden and a bipartisan group of senators on June 24 agreed on a framework to invest in “hard” infrastructure, including transit, roads, bridges and the electrical grid. (White House Fact Sheet and bipartisan Senate group framework, June 24)
  • Senate Majority Leader Chuck Schumer (D-NY) stated last week that he plans to hold votes on both measures before the Senate leaves for its August recess. (AP and CNBC, July 9)

Bipartisan Proposal Deadline

Capitol with evening sky

  • Schumer pushed his schedule forward by announcing the Senate will take a procedural vote next week to begin debate on the unfinished bipartisan proposal. The move forces a tight deadline on Senate negotiators to produce a detailed version of their bipartisan proposal, which has many unresolved issues, including funding sources. (Politico, July 15)
  • Sen. Shelley Moore Capito (R-WV) said Schumer’s decision is an attempt “to put pressure on the group to either put up or shut up,” according to Politico.
  • Sen. Lisa Murkowski (R-AK) said, “The good news-bad news is we’ve got a pretty tight time frame. There are details we have to resolve, and those details involve things like [paying for it].” (Washington Post, July 15)
  • The bipartisan proposal, if translated into legislation, would need any combination of 60 votes in the 50-50 Senate to avoid a filibuster and start debate on the measure.

Budget Blueprint Directive

  • Schumer also said he wants the Senate Budget Committee to agree by July 21 on the details of their separate 10-year budget blueprint, after they agreed this week to its overall $3.5 trillion spending level. (New York Times, July 15)
  • The committee must now build support for a budget resolution, which would give fiscal targets to other Senate committees responsible for producing an eventual, final bill – including how taxes would be raised to pay for it.
  • Senate Budget Committee Chairman Bernie Sanders (I-VT) commented this week, “What happens next is this is an enormously large and complicated piece of legislation and it’s going to take an enormous amount of work amongst 50 people to reach agreement.” (BGov, July 15)
  • Passage of a budget blueprint would also mark the beginning of the reconciliation process, which would allow Democrats to pass an expansive economic package without Republican votes. (Bloomberg, July 15)

SALT Inclusion

  • The Democratic budget outline may include a partial expansion of the state and local income tax deduction (SALT), according to Sen. Bob Menendez of (D-NJ), a member of the Senate Finance Committee.
  • “My understanding is there is a SALT provision in there that would provide relief,” Menendez told NJ Advance Media. (NJ.com, July 15)
  • Since the SALT deduction was capped at $10,000 in the Republican Tax Cuts and Jobs Act of 2017, Democratic lawmakers from high-tax states have urged the inclusion of a SALT expansion in longer-term fiscal packages.

Roundtable Perspective

Avison Young tax webinar

  • Roundtable Senior Vice President & Counsel Ryan McCormick, bottom left in photo, participated in the Avison Young July 14 webinar “Proposed Federal Tax Policy Changes.” Additional participants included Lisa Knee and Kenneth Weissenberg of Eisner Amper.
  • Roundtable Senior Vice President Chip Rodgers participated in the Association of Foreign Investors in Real Estate July 13 webinar “Mid-Year Policy Update.” Additional participants included Elizabeth Espín Stern, Partner at Mayer Brown and Hope Goldman, Senior Associate at The Cohen Group. (Watch video after entering the password “AFIRE!!”)

What’s Next

  • President Biden yesterday commented on the dual track approach in the Senate. “There may be some last-minute discussion as to what mechanism is used to pay for each of these items, both the infrastructure package and the human infrastructure package. But I believe we will get it done.” (White House transcript, July 15)

In the House, Speaker Nancy Pelosi has pledged that the chamber will not move forward until the Senate passes a budget setting up the $3.5 trillion social spending package. (The Mercury News, June 25 and Transcript of Pelosi Press Conference, June 24)

#  #  # 

House Passes Surface Transportation Infrastructure Bill; Negotiations with Senate Ahead

San Diego Transportation Infrastructure

The House yesterday approved a five-year, $760 billon surface transportation and water bill (H.R. 3684) with climate provisions, which Democrats plan to use in infrastructure negotiations with the Senate. The INVEST in America Act passed by a vote of 221 to 201, with only two Republicans joining Democrats in support. (Washington Post, July 1 and Invest in America Act Fact Sheet)

Must-Pass Transportation Funding

  • The House bill does not detail pay-fors yet, but is considered must-pass legislation, as funding for the nation’s surface transportation programs expires on Sept. 30. (Roundtable Weekly, June 11)
  • Roundtable President and CEO Jeffrey DeBoer last week said, “Americans depend on safe and efficient roads, bridges, and mass transit to commute all across the country. Our nation’s buildings and the people in them depend on reliable supplies of water, power, and broadband to function, and meet the evolving demands of business and individual tenants. In turn, infrastructure and real estate are synergistic, and have a two-way relationship.” (Roundtable news release, June 25)

Different Paths

U.S. Capitol Sunny Sky

  • In the Senate, a bipartisan agreement was reached last week with the White House on the outlines of a package addressing “physical” infrastructure. The agreement nearly fell apart after President Biden said the bill was directly linked to the passage of a separate, multi-trillion dollar “human” infrastructure proposal. (RRoundtable Weekly, June 25)
  • The Senate proposal includes $579 billion in new spending and was initially supported by 11 Republicans, although some have since objected. Ten Republican Senators would be needed to overcome a filibuster in the 50-50 chamber. (Bloomberg, June 25 and Punchbowl News, June 30)
  • The costs for all the infrastructure “asset classes” in the bipartisan framework are detailed in a recent White House memo from Brian Deese, Director of the National Economic Council, and Anita Dunn, Senior Adviser. (Deese-Dunn memo)
  • The Senate infrastructure agreement has not yet been translated into legislation. Republican and Democratic Senators disagree if they should move forward with a stand-alone bill, or insist on pairing it with a massive “social” infrastructure package. As Senate talks continue, the House bill passed this week could present another path toward a final infrastructure bill, since it comes with a Sept. 30 deadline. (Politico, June 30)
  • House Speaker Nancy Pelosi (D-CA) plans to reference the House bill as a base for negotiating changes to the Senate’s $973 billion bipartisan infrastructure framework in the coming weeks. (BGov, June 30)
  • House Transportation and Infrastructure Chair Peter DeFazio (D-OR), the lead sponsor of H.R. 3684, said, “I’m suggesting that substantial amounts of the policy in our bill should be negotiated by the White House, the Senate and the House to be part of that bipartisan proposal.” (New York Times, July 1)

What’s Next

White House bright

  • Senate Minority Leader Mitch McConnell (R-KY) this week said President Biden should encourage Pelosi and Senate Majority Leader Chuck Schumer to support the bipartisan proposal without a dependent, separate bill that would move through a restrictive budget “reconciliation” process. According to McConnell’s June 28 statement, “The President cannot let congressional Democrats hold a bipartisan bill hostage over a separate and partisan process..”

  • White House Press Secretary Jen Psaki commented June 30 on the evolving infrastructure proposals, stating, “It’s up to leaders in Congress to move this forward. The President looks forward to signing both pieces of legislation into law.”  (White House Press Briefing transcript)

Senate Democrats are aiming to pass bipartisan infrastructure legislation and send it to the House before the August recess, in hopes that a package could arrive on President Biden’s desk by the end of September. (Reuters, June 29)

#  #  #

Bipartisan “Physical” Infrastructure Agreement Announced; Separate Package on “Social Infrastructure” Tied to Reconciliation Path

Infrastructure Chicago interexchange

President Joe Biden and a bipartisan group of senators yesterday announced a tentative agreement to address the nation’s “physical” infrastructure – as Democrats indicated that its passage into law would depend on enactment of a separate, much larger “social” infrastructure bill structured to bypass Republican votes through a budget “reconciliation” process. 

Goals and Pay-Fors 

  • The total cost of the physical infrastructure deal, according to the White House, is $1.2 trillion over eight years, with $579 billion in new spending for investments in transit, roads, bridges, the electrical grid, and other systems. (White House Fact Sheet, June 24)
  • The 21-member bipartisan Senate group also released a document outlining how the agreement would be funded while avoiding new taxes. Among the pay-fors listed: 
    • Leverage private sector investment through incentivizing use of public private partnerships, expanding use of Private Activity Bonds, and encouraging asset recycling.
    • Create direct-pay municipal bonds to attract more investment in public infrastructure.
    • Repurpose unused COVID relief funds. 

Jeff DeBoer RER Meeting

  • Roundtable President and CEO Jeffrey DeBoer, above, said, “Americans depend on safe and efficient roads, bridges, and mass transit to commute all across the country. Our nation’s buildings and the people in them depend on reliable supplies of water, power, and broadband to function, and meet the evolving demands of business and individual tenants. In turn, infrastructure and real estate are synergistic, and have a two-way relationship.”
  • DeBoer added, “The package has potential to impact GDP, promote job growth, keep the U.S. competitive with other countries that are massively investing in their own infrastructure, and expand the overall economy.”

Next: Reconciliation

Capitol Hill trees clouds in the evening

  • President Biden said that signing the bipartisan physical infrastructure deal into law would be contingent on a separate bill addressing his administration’s “social infrastructure” agenda on matters such as education and child care. “If the [physical infrastructure bill] is the only one that comes to me, I’m not signing it.” Biden said (Wall Street Journal, June 24)
  • Democratic leaders are aiming to move the “social” infrastructure bill through the budget reconciliation process which would only require a simple, 51-vote majority in the Senate. (NPR, June 24)
  • House Speaker Nancy Pelosi (D-CA) said yesterday, “We will not take up a bill in the House until the Senate passes the bipartisan bill and a reconciliation bill. If there is no bipartisan bill, then we’ll just go when the Senate passes a reconciliation bill.” (The Hill, June 24)
  • Senate Majority Leader Schumer stated his timeline is to have both the bipartisan infrastructure bill and the budget reconciliation bill passed in July. (Politico, June 24) 

Housing — New FHFA Director 

FHFA logo

  • President Biden on June 23 removed Fannie Mae and Freddie Mac’s chief regulator, hours after the U.S. Supreme Court ruled that the Federal Housing Finance Agency’s (FHFA) loan director is insufficiently accountable to the president. (CNBC and BloombergLaw, June 23)
  • Mark Calabria, a Trump administration appointee, focused much of his efforts at FHFA trying to end Fannie and Freddie’s 12 years under government conservatorship. A Biden White House official said, “It is critical that the agency (FHFA) implement the Administration’s housing policies.” (CNBC, June 23)
  • Calabria was replaced on an acting basis with FHFA Deputy Director Sandra Thompson. Since 2013, Thompson has led FHFA’s housing and regulatory policy, capital policy, financial analysis, fair lending and all mission activities for Fannie Mae, Freddie Mac and the Federal Home Loan Banks. (FHFA statement, June 24) 

The Roundtable’s Real Estate Capital Policy Advisory Committee (RECPAC) works on issues related to Fannie Mae and Freddie Mac and their impact on commercial real estate.

#  #  #

Senate Efforts Pursue Two-Track Approach to Infrastructure Package

Senate members announced this week that they are pursuing a two-track approach in assembling an infrastructure package in response to President Biden’s original multitrillion dollar proposal – a pared-down bipartisan plan, and a much larger Democratic plan that could advance on a narrow, party-line vote path. 

Bipartisan Framework

  • In the wake of failed negotiations last week between the White House and Senate GOP leaders, a group of five Democrats and five Republicans began work on an alternative plan focused on “core, physical infrastructure.” The bipartisan Senate group expanded this week to 21 members, including 11 Republicans. At least 10 Republicans in the 50-50 Senate must approve a bill to reach the 60-vote threshold for passage. (Bloomberg and Washington Post, June 16)
  • A draft outline of the bipartisan group’s infrastructure proposal published on June 16 by Politico revealed a framework that would cost $974 billion over five years, including $579 billion in new spending.
  • President Biden originally proposed $2 trillion in new infrastructure spending, then signaled a compromise closer to $1 trillion. (Roundtable Weekly, June 11)
  • The Senate group’s framework also includes numerous funding sources, such as unspent coronavirus relief aid and public-private partnerships. Since the document’s release, Republicans have provided assurances that a final framework would not include indexing the national gasoline tax to inflation, a proposal opposed by President Biden and House Speaker Nancy Pelosi (D-CA). (Politico and The Hill, June 17)

The Reconciliation Path

U.S. Capitol at sunset
US Capitol building at sunset, Washington DC, USA.
  • Meanwhile, Senate Majority Leader Chuck Schumer (D-NY) this week met with Democratic senators on the Budget Committee to trigger the budget reconciliation process, which would allow a party–line majority vote of an infrastructure package, eliminating the need for Republican votes. (Associated Press, June 17)
  • According to the AP, “Sen. Tim Kaine (D-VA) said the Budget Committee was unified in putting together a package that ‘gives us a latitude to do what we need to do — we can shrink it if there’s a bipartisan deal, we could do the broader deal if there isn’t.’”
  • Schumer said he would like to pass next month both a bipartisan infrastructure package and a larger budget blueprint, which would address a follow-up Democratic legislative. (BGov, June 17)
  • Additionally, Senate Budget Chairman Bernie Sanders (I-VT) said he is seeking a $6 trillion measure that would fund both Biden’s infrastructure proposals, including reforms targeting climate change and an expansion of Medicare. (Wall Street Journal and Washington Post, June 17
  • Sen. Mark Warner (D-VA), a member of the bipartisan group leading infrastructure negotiations, said, “I know there needs to be reconciliation. But that also doesn’t mean that I accept all of what the president proposed and all of what Sen. Sanders has proposed.” (BGov, June 17)
  • The Real Estate Roundtable, along with 16 other national real estate trade organizations submitted detailed comments in May to the Senate Finance Committee and House Ways and Means Committee as part of hearings on how to fund the administration’s infrastructure proposals. (Roundtable Weekly, May 21)

The Roundtable’s Annual Meeting this week also featured discussions with policymakers on the evolving infrastructure debate – and the organization plans to remain fully engaged with lawmakers on any eventual legislative proposal that could affect commercial real estate. 

#  #  #

Infrastructure Negotiations Shift to Bipartisan Congressional Groups; House, Senate Committees Advance Surface Transportation Bills

Capitol Hill trees clouds in the evening

Months of negotiations on bipartisan infrastructure legislation between President Biden and Republicans led by Sen. Shelley Moore Capito (R-WV) collapsed this week – and talks have shifted to alternative approaches from bipartisan groups of congressional policymakers. Meanwhile, House and Senate committees are moving forward on spending bills to meet the nation’s surface transportation needs before current funding expires on Sept. 30. (White House statement, June 8 and CQ, June 10) 

Alternative Paths 

  • President Biden recently reduced his original infrastructure package proposal from $2.3 trillion to $1.7 trillion – and requested at least $1 trillion in new spending from Republicans. The Senate GOP group counteroffered with nearly $1 trillion, which included only $330 billion in new spending and the rest from repurposed COVID-19 relief funding signed into law earlier this year. Biden cancelled the talks after the gap over the package’s scope and funding could not be bridged. (The Hill and AP, June 8)
  • Yesterday, a bipartisan group of 10 senators said they would propose a plan focused on “core, physical infrastructure” infrastructure that would cost $974 billion over five years, or $1.2 trillion over eight years, including about $579 billion in new spending. (CQ and New York Times and Washington Post, June 10)
  • According to Axios, “The group proposes paying for it through unspent coronavirus relief aid, public-private partnerships, indexing the gas tax to account for inflation and allowing states to borrow necessary money through a revolving loan fund.”
  • A joint statement released by the senators said, “[We] reached a bipartisan agreement on a realistic, compromise framework to modernize our nation’s infrastructure and energy technologies. This investment would be fully paid for and not include tax increases.” (Joint statement, June 10)

  • In the House, the Problem Solvers Caucus, which has 29 Democrats and 29 Republicans, on June 9 released a $1.25 trillion infrastructure spending framework, including $761.8 billion in new spending over eight years – yet did not include any details about how to pay for the proposal. (News release, Building Bridges Infrastructure  Framework and section-by-section summary)
  • The co-chairs of the House caucus – Reps. Josh Gottheimer (D-NJ) and Brian Fitzpatrick (R-PA) – are also in contact with a key group of bipartisan group of senators, including Bill Cassidy (R-LA), Kyrsten Sinema (D-AZ), Rob Portman (R-OH) and Joe Manchin, (D-WV) about developing a bipartisan, bicameral infrastructure package. (CQ, June 9)

  • White House Press Secretary Jen Psaki this week said, “[President Biden] feels it’s encouraging to see multiple proposals put out there, both from Republicans in the House and the Problem Solvers Caucus, as well as a bipartisan group that’s working on a proposal. Both will have increased numbers over what we’ve seen and been negotiating to date. Those are all positive steps.” (White House Press Gaggle, June 9)

Surface Transportation Legislation 

road construction and workers

  • Yesterday, the House Transportation and Infrastructure (T&I) Committee advanced a five-year, $547 billion surface transportation bill by a vote of 38-26 that included two supporting Republican votes. (Section-by-section summary of the INVEST in America Act)
  • Although the House Ways and Means Committee needs to address how to fund the bill’s costs, many of the provisions align with Biden administration transportation priorities – and could serve as a possible cornerstone for a larger infrastructure package. (CQ and BGov, June 10)
  • House Majority Leader Steny Hoyer (D-MD) said the chamber will take up the T&I committee bill the week of June 28.  A reauthorization bill for surface transportation is considered must-pass legislation as current funding expires Sept 30. (Washington Post, June 10)
  • In the Senate, several committees have jurisdiction over portions of that chamber’s surface transportation bill. The Environment and Public Works Committee unanimously voted on May 26 to advance a $303.5 billion bill over the next five years to fund the nation’s roads, bridges, tunnels, and mass transit projects. (Roundtable Weekly, June 4)
  • The Senate Commerce, Science and Transportation Committee is scheduled to consider rail and safety issues on June 16. Separately, a spokeswoman for Senate Banking, Housing and Urban Committee said Chairman Sherrod Brown (D-OH) said he continues to work with Ranking Member Patrick Toomey (R-PA) “in hopes of reaching a bipartisan agreement on a robust transit title for a surface transportation bill.” (CQ, June 10)

Reconciliation

Schumer fists podium

  • Democrats are also considering the use of the budget “reconciliation” process, which would allow them to bypass the Senate’s 60-vote requirement to pass legislation and push through an infrastructure package on a party line vote. (Roundtable Weekly, June 4)
  • Senate Majority Leader Charles Schumer (D-NY), above, said yesterday, “We continue to proceed on two tracks. A bipartisan track and a reconciliation track — and both are moving forward.” (Washington Post, June 10)
  • Schumer said last week that he wants to move forward on an infrastructure bill in July, whether it is bipartisan or not. (The Hill, May 25)
  • A National League of Cities’ 2021 State of Cities report released this week supported the need for infrastructure investment nationwide. Of the 600 mayors who provided information for the report, 91 percent said they did not have the funds to make needed infrastructure investments. (NLC news release, June 10)

The Roundtable will focus on the evolving infrastructure negotiations and their possible impact on CRE during its June 15-16 Annual Meeting and Policy Advisory Committee Meetings in Washington, DC.

#  #  #

Senate Committee Unanimously Reauthorizes Highway Trust Fund; “Gateway” Hudson Tunnel Project Reaches Major Milestone

Senate Environment & Public Works Comittee

The Senate Environment and Public Works (EPW) Committee’s unanimous vote last week to advance $303.5 billion over the next five years to fund the nation’s largest source for roads, bridges, tunnels, and mass transit may help advance negotiations over President Biden’s infrastructure proposal. (BGov, May 26)

A Bipartisan Signal

  • Senate EPW Ranking Member Shelly Moore Capito (R-WV) is the lead GOP negotiator on the White House’s infrastructure proposal, which includes $115 billion for repairing Main Street roads, highways and bridges. (White House Fact Sheet: The American Jobs Plan, March 31)
     
  • Sen. Capito said the 20-vote committee vote to advance the Surface Transportation Reauthorization Act “… is further proof that a bipartisan infrastructure deal is possible. I’m hopeful this bipartisan product can be the anchor of a larger infrastructure package moving forward.” (Senate EPW Markup and news release, May 26)
     
  • The Senate committee’s measure would set a new baseline funding level for the Department of Transportation’s Highway Trust Fund – an increase of more than 34 percent from the last reauthorization to pass Congress in 2015.  (Full text of the EPW bill and one-page summary)

Time Considerations

Road Construction ramp

  • The Senate EPW Committee only has jurisdiction over the surface transportation bill’s highway section. The Senate Commerce Committee is next, with a markup expected the week of June 14. The Senate Finance Committee will eventually address how to pay for the measure and the Senate Banking Committee will consider sections dealing with mass transit programs.
     
  • In the House, Democrats on the Transportation and Infrastructure Committee  introduced the INVEST in American Act today and plan to mark up their surface reauthorization bill on June 9. (Bill Text | Fact Sheet | Section-by-Section and Washington Post, June 4)
  • The Biden administration was encouraged by the Senate EPW vote. White House Press Secretary Jen Psaki said during a May 25 briefing that the$303 billion dollar bill “is a great down payment” for a broader infrastructure package. (BGov, May 26)
     
  • However, the administration has expressed it is on a tighter deadline to advance a comprehensive infrastructure proposal. Transportation Secretary Pete Buttigieg recently said, “I think we are getting pretty close to a fish-or-cut-bait moment.” (CNN, May 30) 

Gateway Progress

Gateway Hudson Tunnel Project

  • The Biden Administration on May 28 approved a key step allowing the multi-billion dollar “Gateway” rail tunnel project between New York City and New Jersey to move forward, ending years of delay and clearing the way for state officials to apply for federal funding.  (New York Times, May 28)
     
  • The administration’s approval of a long-awaited environmental impact statement clears the way for pre-construction activities to begin on the crucial infrastructure project, which aims to repair tunnels damaged by Superstorm Sandy. (Politico, May 28)
     
  • Transportation Secretary Buttigieg commented on the approval – clearing the way for the project to advance to the next steps such as engineering, final design development, and property acquisition, as well as construction. “This is a big step for the Northeast, and for the entire country, as these tunnels connect so many people, jobs, and businesses,” he said. (DOT statement, May 28)

Senate Majority Leader Chuck Schumer (D-NY) said, “It’s probably the most important public works project in America. If those tunnels fail and can’t be used, 25 percent of our economy would be at risk from Boston to Washington.” (Politico, May 28) 

#  #  # 

Policymakers Remain Far Apart on Bipartisan Infrastructure Package; Senate Ruling Limits Reconciliation as Fast-Track Option

President Biden and Sen. Capito

Policymakers this week remained far apart on the scope and cost of a possible bipartisan infrastructure package, as President Biden floated a 15% minimum corporate tax to partially fund his pared-down proposal. Meanwhile, a recent Senate Parliamentarian ruling would limit the use of a fast-track budget process called “reconciliation” that could allow Democrats to bypass Republicans and pass legislation on a party-line vote. (Washington Post, June 3, The Hill and New York magazine, June 2)  

[Photo above: President Biden discusses infrastructure with Sen. Shelley Moore Capito (R-WV)]

Seeking New Spending

  • President Biden recently reduced his original infrastructure package cost from $2.3 trillion to $1.7 trillion – and is now looking for at least $1 trillion in new spending from Republicans on infrastructure. Biden this week proposed raising these funds partially through a new 15% minimum corporate tax, which would replace his initial proposal to raise the corporate income rate to 28% from 21%. (BGov and New York Times, June 3)
  • Sen. Shelley Moore Capito (R-WV), who is leading GOP lawmakers in negotiations with the White House, last week counteroffered with $928 billion – although it limits new spending to $257 billion for traditional “hard” infrastructure such as roads, bridges and other public works. Republicans proposed the remaining $671 billion come from repurposed funding previously passed as part of the American Rescue Plan Act’s Covid-19 relief effort. Democrats have rejected repurposing of funds. (Roundtable Weekly, May 28 and AP, May 27)
  • The U.S. Conference of Mayors, National League of Cities and National Association of Counties recently expressed their “adamant opposition to any proposal that would detrimentally recoup and repurpose funds allocated to local governments” from coronavirus relief funds. (NLC news release, June 1 and joint letter, May 27)
  • The coalition’s joint letter to congressional leadership, stated, “Local governments are using these critical recovery funds to invest in public safety, vaccine distribution, housing and rental assistance, local economic support, economic and workforce development, broadband expansion, social safety-net services, hospitality and tourism development, and hazard pay for public employees.”

Time is Short

The White House with Washington Monument

  • White House Press Secretary Jen Psaki this week said, “Patience is not unending, and [President Biden’s] wants to make progress. His only line in the sand is inaction. He wants to sign a bill into law this summer.” (White House Press Briefing, June 2)
  • The No. 3-ranked House Democrat, Rep. Jim Clyburn of South Carolina, yesterday said time is short to complete negotiations on a bipartisan package. “I don’t think we should run the risk of not getting something done because the other side is not cooperating.” (Bloomberg’s Balance of Tower, June 3)
  • Sen. Ben Cardin (D-Md.) on Thursday added that Democrats would soon take actions to use the budget reconciliation process to bypass the Senate’s 60-vote requirement to pass legislation and push through a bill on a party line vote.  Cardin said that Democrats are “going as far as we can with Republicans and not delay[ing] it beyond this work period without seeing some action.” (Politico, June 3)
  • Senate Majority Leader Charles Schumer (D-NY) said last week that he wants to move forward on an infrastructure bill in July, whether it is bipartisan or not. (The Hill, May 25)

Limits on Reconciliation

Senate side - Capitol Building

  • The Democrats’ alternative plan to use reconciliation to bypass Republican opposition on infrastructure legislation may be slowed by a recent Senate Parlimentarian ruling. Congressional Democrats used reconciliation in March to pass the administration’s $1.9 trillion pandemic relief package. (Roundtable Weekly, March 12)
  • Senate Parliamentarian Elizabeth MacDonough’s four-page opinion, issued to Senate staff on May 28, stated, “overuse and over-reliance on a hyper-fast track procedure in the ordinarily deliberative Senate … will change the culture of the institution to the detriment of the committee and amendment processes and the rights of all Senators.” (CQ, June 2)
  • The new guidance adds that lawmakers intended the reconciliation provision to be used only “in extraordinary circumstances and not for things that should have been or could have been foreseen and handled” in a regular budget resolution. 

The ruling suggests that Democrats will be restricted to one additional opportunity this year to use reconciliation to pass a filibuster-proof legislative package.  (Roll Call, June 2 and The Hill, June 4)

#  #  #