While President-elect Donald Trump and members of Congress have much work to do in developing a detailed legislative agenda for 2017, there is early speculation in Washington that a major infrastructure renewal bill could be among the items considered during his first 100 days in office.
Trump’s campaign had previously shown an interest in improving the nation’s infrastructure, with an “America’s Infrastructure First” policy plan pledging to “make clean water a high priority” while calling for tripling funding for the Drinking Water and Clean Water State Revolving Fund (SRF) programs. But a campaign document also put significant focus on promoting private investment as a solution to the nation’s infrastructure problems – and it is not clear how such an arrangement would work for projects in the water sector. As a candidate Trump often pointed to the need for investment in the nation’s infrastructure, and part of his post-election victory speech included a pledge to make American infrastructure “second to none.”
Other parts of the campaign document promised Trump would “develop a long-term water infrastructure plan with city, state and federal leaders to upgrade aging water systems,” “end needless red tape,” increase the use of public-private partnerships “through a deficit-neutral system of infrastructure tax credits,” and encourage the use of American steel in domestic infrastructure projects.
A comprehensive tax reform bill could also see action on Capitol Hill in 2017, as the Trump campaign has expressed support for a tax plan that will reduce rates across the board while eliminating special interest loopholes. But unclear is whether Trump would consider the existing tax exemption for municipal bond interest as such a loophole, or as an effective mechanism to fund American infrastructure.
In response to this uncertainty about the status of municipal bonds, and while also seeking to highlight ways that the water sector can work with the President-Elect, on November 17 AMWA wrote to Trump with a letter that summarized four priorities for the new administration. In addition to arguing for the preservation of tax-exempt municipal bonds as an effective water infrastructure funding mechanism, the letter called for strong funding for the Drinking Water State Revolving Fund and the Water Infrastructure Finance and Innovation Act program, helping water systems upgrade infrastructure to build resilience to extreme event, and offering aid to help communities and low-income homeowners replace lead service lines.
Conversely, the combination of a Trump White House and a Republican congress will likely leave some other issues dormant on Capitol Hill for the foreseeable future. These include proposals to reduce greenhouse gas emissions, to impose “inherently safer technology” mandates on water utilities and chemical storage facilities, and to amend the Safe Drinking Water Act to make it easier for EPA to implement new drinking water contaminant regulations. While legislation on each of these issues may be reintroduced in Congress next year, each will stand virtually no chance of advancing as long as the GOP holds both chambers of Congress.