President Trump’s comments on transportation infrastructure Tuesday night left planners uncertain about how the Philadelphia region would pay for big-ticket projects that have been years in development.
For now, there are only a few comments from the president and a leaked draft plan to go on. A formal proposal for federal infrastructure spending isn’t expected until later this month. What’s come out so far, though, suggests the administration is considering dramatic changes in the role federal money plays in the future for roads, transit, and bridges.
“We’re certainly not throwing any plans away because, like I said, this is still a draft,” said Barry Seymour, executive director of the Delaware Valley Regional Planning Commission. “We’re waiting to see, but we certainly have our antenna up to keep an eye on this.”
Among the plans that could require rethinking, Seymour said, are a $1.1 billion project to extend the Norristown High Speed Line to King of Prussia and a proposal to build a railroad from Gloucester County to Camden, which is in a much earlier stage of planning but could cost $2.6 billion.
In the State of the Union address Tuesday, Trump proposed that the federal government plan a $1.5 trillion infrastructure spending bill. The catch, though, is that he expects the federal government to kick in only $200 billion, according to an interview the president had with the Wall Street Journal. The rest would come from state and local sources.
The need for major infrastructure investment was a big part of Trump’s campaign platform. In 2017, the American Society of Civil Engineers gave the country’s infrastructure a grade of D-plus. Pennsylvania has historically had among the highest percentage of structurally deficient bridges in the country and as of 2016, ranked fourth worst in the nation, according to the federal Department of Transportation. New Jersey was sixth worst. Both states also ranked in the top 20 in the nation with the highest percentage of roads in poor or mediocre condition.
Pennsylvania’s Department of Transportation largely declined to weigh in on Trump’s comments, saying only that it looked forward to a federal commitment to infrastructure spending.
“We need the robust involvement of the federal government in supporting infrastructure investment if we are to continue to make progress against the tremendous outstanding highway and bridge needs across Pennsylvania,” PennDot spokesman Rich Kirkpatrick said in a statement.
New Jersey’s Department of Transportation declined to comment Wednesday. Also not commenting were officials from SEPTA, which is championing the King of Prussia rail project, saying officials there did not have enough information to respond to Trump’s comments.
A draft of Trump’s infrastructure proposal leaked to Politico described a grant process in which federal money would pay for no more than 20 percent of the total costs of an infrastructure project. And the draft suggested the federal government would evaluate projects’ worthiness largely by the amount of non-federal funding that could be devoted to it.
Those numbers represent a big change in the standard federal funding formula. Traditionally, federal money would pay for close to 80 percent of a project, Seymour said. Congress passed a $305 billion infrastructure bill in 2015, but before that, a lack of a comprehensive infrastructure package left local and state planners forced to depend more on their own resources for infrastructure work. A more typical funding formula, Seymour said, has called for federal money to pay for half of a project’s cost.
“The federal government has long been the significant partner in transportation,” Seymour said. “It’s hard to know exactly where this is going.”
Trump on Tuesday night described a process in which federal spending would be a primer, essentially, used to draw other investment.
“Every federal dollar should be leveraged by partnering with state and local governments and, where appropriate, tapping into private-sector investment — to permanently fix the infrastructure deficit,” he said.
One of the most pressing infrastructure projects in the country is the $23.9 billion Gateway plan, which would replace tunnels under the Hudson River between New Jersey and New York and increase track capacity at the city’s Penn Station. Sen. Bob Menendez (D., N.J.) said before Trump’s speech Tuesday that asking states to shoulder the cost of a project that will shape the economy of the entire East Coast is impractical.
The importance of that project, Menendez said, is “beyond New York and New Jersey. They serve the entire Northeast Corridor and generate 25 percent of GDP for the entire country. Asking states as a proposition is ridiculous.”
He and others noted that states may be asked to kick in more infrastructure money just as a Republican tax bill limited taxpayers’ ability to get federal tax deductions based on what they pay in state taxes. That change, capping the deduction at $10,000, as part of the tax bill passed in December, could make it harder for states and municipalities to raise new funds, he said.
Democrats were quick to criticize Trump’s proposal, particularly the idea of seeking private-sector investment for public projects.
“What we’re left with is the Republican vision of incentivizing public/private partnerships that proceed not to invest in American infrastructure but to sell off American infrastructure,” Sen. Jeff Merkley (D., Ore.) said during a conference call Wednesday.
He also lambasted an element in the draft proposal that would allow states to toll federal highways to raise funds for infrastructure projects.
Tolling highways as a way to raise revenue is an idea Pennsylvania has explored before, Seymour said. Public/private partnerships, though, will be of limited use because most of the infrastructure work needed in Pennsylvania is repair and renovation, not construction of a new bridge that could be profitable through toll revenue.
“No company is going to fix an existing bridge unless they can add tolls,” he said. “They’re not going to pay for a pothole.”
Trump also called for a more streamlined process to get projects off the drawing board and into construction.
“Any bill must also streamline the permitting and approval process — getting it down to no more than two years, and perhaps even one,” he said.
Sen. Pat Toomey (R., Pa.) endorsed that idea in his comments before the State of the Union address.
“The endless delays end up costing an enormous amount of money along the way, making these projects more expensive than they need to be, and obviously, it delays the point at which we would have that infrastructure in service,” said Toomey, who has long championed a limited government role in the economy.
Democrats, though, said a faster turnaround would happen at the expense of the environment.
“It’s code for rolling over environmental protections,” Merkley said.