Democrats and Republicans have both signaled interest in tackling infrastructure this Congress, but a major question mark surrounding the issue has persisted: How do we pay for it? The U.S. Chamber of Commerce is hunting for fresh answers to that question, offering cash prizes totaling $25,000 for those “who can come up with the best, most viable ideas for a long-term sustainable funding source for infrastructure.”
Some lawmakers, along with the Chamber, have suggested raising the federal gas tax, which has remained at 18.4 cents a gallon since 1993.
“You’ve heard me say for years that a modest increase to the motor vehicle fuel user fee — which hasn’t been adjusted in 25 years — can be a big part of the solution,” U.S. Chamber of Commerce President and CEO Tom Donohue said in his prepared remarks at the 2019 State of American Business Address earlier this month. “I’ve also said the Chamber is open to viable alternatives — but we haven’t heard too many other ideas.”
Donohue said that his goal in holding the contest is that “the public and private sector leaders of this country will finally come together and help build the next generation of U.S. infrastructure — a modern, safe, and efficient system that history will regard as one of the great American feats of the 21st century.”
“Is that too ambitious?” Donohue asked. “Good. Let’s go do it.”
President Trump has discussed making infrastructure a priority since his 2016 campaign. In February, the White House released a blueprint that would use $200 billion in federal funding to spur a minimum of $1.3 trillion in infrastructure spending from state and local governments, in addition to private sector buy-in. But the plan failed to gain traction on Capitol Hill and was put on the back burner.
In contrast, House Transportation and Infrastructure Committee Chairman Rep. Peter DeFazio, D-Ore., said in November, after Democrats regained a majority in the House, that an infrastructure plan must include significant federal investment.
“There has to be real money, real investment,” DeFazio told reporters. “We’re not going to do pretend stuff like asset recycling. We’re not going to do massive privatization.”
A $1 trillion infrastructure plan proposed last year by lawmakers including Sen. Tom Carper, D-Del., would have repealed some of Trump’s tax cuts and hiked the corporate tax rate to 25 percent. Another option backed by ranking member of the House Transportation and Infrastructure Committee Rep. Sam Graves, R-Mo., is to impose a vehicle miles-traveled tax, or VMT, which would make users’ fees dependent on their mileage.
The Chamber’s contest is more likely to attract resuscitated old ideas than genuinely new ones, predicts Joseph Kane, a senior research analyst and associate fellow of the Metropolitan Policy Program at the Brookings Institution. Familiar ideas he expects to see revived include the Build America Bonds program that allowed borrowers to receive a direct federal subsidy or a federal tax credit on special taxable bonds issued by state and local governments. The program expired in 2010.
There’s not much time to submit ideas. According to Donohue, the “good ideas” they receive will be debated at the Chamber’s annual infrastructure summit on Feb. 5.
Given the tight turnaround, Kane said he expects the contest will generate conversations that could lead to policy but probably won’t “drive the creation of something that’s been out of our reach for some time.”
“If we haven’t been able to implement any new ideas in the past few years, to do so over the next few weeks is going to be difficult,” Kane said.
“In that sense, it’s already kind of mission accomplished — that people are talking about this again.”
