Infrastructure Must-Reads, January 20

The staff of the Bipartisan Policy Center’s Executive Council on Infrastructure share some recent publications, speeches, and testimony relevant to infrastructure policy and finance. The views expressed in these pieces do not necessarily represent the views of the council, its co-chairs, members, advisors or BPC.

Compiled by Nikki Rudnick, Aaron Klein and Jake Varn

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Cantor and Peterson: America’s infrastructure needs private investment
By Eric Cantor and Doug Peterson, Richmond Times Dispatch

“Two weeks ago, the U.S. Congress reached an agreement on a five-year transportation funding package, the longest multiyear bill in a decade. The new law will lock in funding for roads, bridges and public transportation over the next five years. Unfortunately, the amount falls far short of what is needed to fill our nation’s potholes and replace our aging bridges for the long term, let alone build the new infrastructure that our growing economy so desperately requires to be globally competitive.

“Throughout Central Virginia, like many other regions, the pipes, sewers and roads are in need of an upgrade. Across America, there are more than 250,000 water main breaks every year. Our nation’s roads are currently graded “D” by the American Society of Civil Engineers. The Bipartisan Policy Center has estimated a $1 trillion gap between the current pace of infrastructure funding and our country’s needs. A failure to remedy this will continue to seriously undermine our economic competitiveness.” Read the article.

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EPA Survey Shows $271 Billion Needed for Nation’s Wastewater Infrastructure
United States Environmental Protection Agency

“The U.S. Environmental Protection Agency (EPA) today released a survey showing that $271 billion is needed to maintain and improve the nation’s wastewater infrastructure, including the pipes that carry wastewater to treatment plants, the technology that treats the water, and methods for managing stormwater runoff.

“The survey is a collaboration between EPA, states, the District of Columbia, Puerto Rico, and other U.S. territories. To be included in the survey, projects must include a description and location of a water quality-related public health problem, a site-specific solution, and detailed information on project cost.” Read the press release. Read the report.

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10 Emerging Trends in 2016: Trends that will change the world of infrastructure over the next 5 years
KPMG

“Barring a global economic meltdown or apocalyptic event, 2016 is already shaping up to be a year of growing momentum for the infrastructure sector.

“The signs of this momentum are everywhere: in new sources of capital and new funding approaches that promise to unlock trillions of dollars in new equity and debt investment; in growing asset management capabilities, cyber security and public procurement, which are ushering in a real step-change in the way operators and owners manage assets; in the growing boldness of governments seeking to catalyze economic and social benefits; and in the growing alignment between the ‘macro’ needs of governments and the ‘micro’ decisions of consumers.” Read the report.

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January 1 Brings Gas Tax Changes: 5 Cuts and 4 Hikes
By Carl Davis, Tax Justice

“Since 2013, eighteen states have enacted laws either increasing or reforming their gas taxes to boost funding for transportation infrastructure. A snapshot of gas tax rate changes scheduled to occur this upcoming January 1st, however, reveals that five states will actually move in the opposite direction as 2016 gets underway.

“Gas tax rates will decline in New York, North Carolina, Pennsylvania, Vermont, and West Virginia—in most cases because of gas tax rate structures that link the rate to the average price of gas (an approach similar to a traditional sales tax applied to an item’s purchase price). But cutting gas tax rates is problematic because doing so reduces funding for economically vital transportation infrastructure investments. And with drivers already benefiting from gas prices that have just reached a six-year low, the timing of these rate cuts is difficult to justify.” Read the article.

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The Procurement of Public Infrastructure: Comparing P3 and Traditional Approaches
By Paul Boothe, Felix Boudreault, Dave Hudson, David Moloney, and Sandra Octaviani, Lawrence National Centre for Policy and Management

“Our objectives in this paper are two-fold: first, we want to clarify the long-term policy objectives that public infrastructure projects aim to support. These objectives will serve to guide our discussion of the two approaches to infrastructure projects throughout the rest of our paper. Second, we want to delve into the underlying factors that explain why and how the traditional approach to public sector procurement has generally been found wanting and the incentive mechanisms by which the P3 approach can potentially address many of those observed failures.

“Governments are constantly faced with a variety of choices among methods of delivering services to their citizens, particularly services that require infrastructure assets. We need, therefore, to ensure that those choices are made on the basis of a clear understanding of the strategic issues involved and, ultimately, employ the procurement approach that is optimal for a particular case/project.” Read the report.

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Commentary: Why Infrastructure Is a Social Justice Issue
By Maya Harris, BET

“The quality of infrastructure disproportionately affects low-income communities and communities of color. Take public transit, where one survey found users are 60 percent people of color. Research shows that access to jobs through affordable transit (or the lack thereof) is one of the most powerful forces for social mobility in low-income communities. But right now, America’s mass transit system is in disrepair — and often doesn’t sufficiently connect to the communities that need it the most. As a result, families and communities that already face the biggest obstacles to success have an even harder time getting to work or school, finding a job or running an errand to the grocery store or the bank. Remember James Robertson, the 56-year-old man in Detroit who walked 21 miles a day to get to and from work because he didn’t have adequate public transit?” Read the article.

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The Big U.S. Transportation Infrastructure Projects to Watch in 2016
By Eric Jaffe, CityLab

“Infrastructure fans across the U.S. had plenty to enjoy in 2015. New York got its first new subway station in a quarter-century, Portland, Oregon, gave the U.S. a major bridge that bans cars, Houston showed how to reimagine a bus system for the 21st century—all of it punctuated by the passage of the first long-term federal highway bill in about a decade. That’s a tough list to top, but 2016 will give it a run for its taxpayer money.” Read the article.

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High costs may explain crumbling support for US infrastructure
By Tracy Gordon, Urban Institute

“With the nation’s Highway Trust Fund projected to go broke at the end of this summer and Congress unable to agree on a permanent fix, it is an opportune time to reexamine the so-called consensus on infrastructure funding—that we need more of it and now. Focusing on how much we spend leaves out a more important question: how much infrastructure we get for our money.

“Put bluntly: the costs of US infrastructure are too damn high.

“How high? It’s not easy to find comprehensive data on infrastructure costs around the globe. But with help from various government and business websites as well as some very busy bloggers, we pulled together data on 144 planned and finished rail projects across 44 countries.” Read the article.