President Donald Trump Infrastructure Plan February 2018
President Donald Trump Infrastructure Plan February 2018

President Trump’s Infrastructure Plan: $1.5 Trillion In Spending, Privatize Select Federal Assets

In February 2018, President Trump revealed his plan for revitalizing the U.S.’s infrastructure with a massive spending plan. The plan seeks to promote $1.5 trillion in spending from $200 billion in federal aid.

The plan will call on local and state governments to fill the spending gap, which amounts to around $1.3 trillion in funding. It will be their responsibility to match federal infrastructure spending by a minimum four to one ratio.

Feds To Provide $200 Billion Of $1.5 Trillion Largely In Form Of Grants

The federal government has expected states to take on a larger role in funding infrastructure in recent years. Trump’s infrastructure assistant, DJ Gribbin, states, “What we really want to do is provide opportunities for state and local governments to receive federal funding when they’re doing what’s politically hard, and increasing investment in infrastructure.”

Around $100 billion of the federal funding will be allocated to local governments in the form of incentive grants. Grants to rural areas will make up another $50 billion in federal contribution. The remaining funds will be split between loan programs and “projects of national significance.”

Source: WSJ

Source: WSJ

Increasing the amount of skilled construction workers is another goal of the plan. Pell grants will now be available to workers for use at institutions like community colleges.

Trump’s proposal also seeks to speed up the rate at which federal permits are approved. Currently, federal permits take five to ten years to be approved. The plan aims to reduce approval times to a two year period. Barack Obama issued an executive order with a similar goal during his presidency.

Plans Calls To Privatize Federal Interest In Reagan and Dulles Airports

The plan has not proposed a specific source for the $200 billion yet. However, the White House has suggested reducing their investment in two airports local to DC: Ronald Reagan Washington National and Dulles International airports. Aside from airports, the George Washington Memorial Parkway and Baltimore-Washington Parkway are also being considered for sale. The plan states that these federal-operated infrastructures would be more suitable for non-federal entities. In other words, the plan calls for the privatization of these assets.

The Chamber of Commerce has also considered raising the federal gas tax by 25 cents per gallon. While this rate has not been increased since 1993, an increase in gas tax is projected to create $394 billion in the next 10 years.

Overall, the American Society of Civil Engineers has stated that the United States will need to invest $4.59 trillion by 2025 in order to fix our rapidly deteriorating infrastructure. However, with recent government measures to cut taxes and increase spending on defense and domestic programs by $300 billion, our national debt is growing at an exponential rate. No doubt, it will be tricky for all levels of government to find the necessary funding sources to pay for the much-needed infrastructure upgrade.

Article By: Frank Marino-Moore

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Matt Rego

Matt is the Founder and CEO of Spotlight Growth, a full service investor relations and awareness service provider. Prior to launching Spotlight Growth, Matt worked six years within the investor relations industry, most recently serving as Vice President of Sales and Marketing at Global Discovery Group, Inc. In addition, Matt has been a financial writer and analyst since 2010 and investing in the stock market since 2007. Articles and content have appeared on well-known financial websites, such as: Investopedia, Google Finance, Yahoo Finance, ValueWalk, Minyanville, Seeking Alpha, CBS MoneyWatch, Investment Underground, Emerging Growth, Blasting News, GenYWealth, and more. In addition, Matt has received an honorable mention in Barrons’ and the New York Post. Matt graduated from the University of Minnesota with a Bachelor’s Degree in Finance.