The $1.25 trillion infrastructure bill approved by the U.S. House of Representatives on Friday is now heading to President Joe Biden’s desk for his signature, likely later this week.
The measure is a key part of the administration’s “Build Back Better” plan and will kick off a range of programs aimed at addressing what is widely seen as a crumbling U.S. infrastructure. It provides funding for such things as high-speed Internet for rural and urban communities, improvements to the electrical grid and repairs to the country’s aging water and sewage pipes.
More than a quarter of the infrastructure funds, meanwhile, have been earmarked for transportation programs, including highways, bridges, railroads and airports. Billions more will back Biden’s effort to shift the country from internal combustion to battery-electric vehicles. But additional funds, including new incentives for EV buyers, remain on hold as Congress debates other elements of the Build Back plan.
Next steps
Passage of the infrastructure plan is “a monumental step forward,” Biden said Saturday, after members of the House approved the Senate-backed bill by a vote of 228 to 206. The measure won thumbs up from a number of Republicans, despite the efforts of former President Donald Trump to block approval.
It helped Democrats to win support for the proposal from much of the American business community.
“The House of Representatives has given its approval, and now the long journey to rebuild America’s failing infrastructure can really begin as soon as President Biden signs the bipartisan infrastructure bill,” said the American Alliance for Manufacturing in a statement.
Automakers also praised the infrastructure plan — even though the industry has been sharply divided over a proposed expansion of electric vehicle incentives.
Funding for transportation-related projects covered by the infrastructure bill includes:
- $110 billion for the update, replacement and addition of new roads and bridges, a package the White House hailed as the single-largest investment in bridge-building since the launch of the national highway system;
- $66 billion for passenger and freight rail improvements. The measure will help overcome years of delayed maintenance by Amtrak, giving the passenger rail service its biggest cash infusion since it was created a half-century ago;
- $39 billion for public transit, for both the repair of buses, rail cars, tracks and stations, as well as the addition of new low-emissions rolling stock;
- $25 billion for airports aimed at addressing repairs, expansions and congestion;
- $17 billion for the nation’s ports, a move that could address some of the underlying causes of shortages facing both consumers and manufacturers — including automakers;
- $15 billion to promote the electrification of the nation’s automotive fleet. That includes money to create a nationwide network of charging stations, a key goal of the president;
- $11 billion for the “Safe Streets for All” program aimed at reversing the recent surge in U.S. highway deaths, including those involving pedestrians and bicyclists.
The lack of a nationwide EV charging network is seen by many experts as a roadblock to widespread public acceptance, especially as other issues, such as cost and range are being addressed.
“We’re going to build out the first-ever national network of charging stations all across the country — over 500,000 of them,” said Biden, “So, you’ll be able to go across the whole darn country, from East Coast to West Coast, just like you’d stop at a gas station now.”
EV incentives still in limbo
But the infrastructure bill does not address another key issue the Biden White House sees as essential for promoting battery-electric cars. As part of the Build Back Better plan, the administration seeks to not only extend the current, $7,500 federal incentives on EVs but lift the cap on how many manufacturers can sell before the tax credits fail out. And a proposal floated by Sen. Debbie Stabenow and Congressman Dan Kildee — both from Michigan — would add up to $5,000 for battery vehicles built in the U.S. using union labor.
Detroit’s Big Three are strongly backing the plan and would be the only ones to fully benefit from the Kildee-Stabenow rider.
Tesla wants the sales cap lifted, as it saw the last of its incentives phased out early in 2020, but it does not use union labor and is expected to begin importing some vehicles from new plants in Germany and China.
Foreign manufacturers have been sharply critical, Volkswagen of America CEO Scott Keogh calling the Kildee-Stabenow proposal “fundamentally unfair.”
The Michigan Congressman recently told TheDetroitBureau.com that he would be open to compromise on some aspects of the plan, such as including vehicles built in Canada, and perhaps even those assembled in U.S. and Canadian plants with high wages and good records on worker rights.
But the final disposition of the EV incentives, along with other key elements of Build Back Better remain to be worked out.