Construction and engineering companies find lots of good news in a newly enacted budget and appropriations package that keeps federal agencies open until late March, provides $89 billion for post-disaster relief and rebuilding and also holds out the prospect of an additional $20 billion in infrastructure funding over the next two years.
Final congressional approval didn’t come until the early hours of Feb. 9, when the Senate passed the measure, 71-28, and the House cleared it by a 240-186 vote. All of that action came after a stopgap spending bill expired at midnight.
That caused a partial governmental shutdown of several hours that ended when President Trump signed the measure. The legislation also extends funding to keep government agencies open through March 23.
Steve Hall, American Council of Engineering Companies' vice president for government affairs, says the brightest highlight in the package is the possibility of an additional $20 billion in regular appropriations for infrastructure—$10 billion in fiscal year 2018 and $10 billion in fiscal 2019.
That funding isn’t spelled out in the text of the legislation, but is part of an agreement among congressional leaders who put the package together. Those leaders included in the measure a $43-billion increase in 2018 and a $68-billion boost in 2019 in the caps on overall nondefense discretionary funding,
The measure also hikes the defense spending cap by $80 billion this year and $85 billion in 2019.
According to a statement from the office of Senate Minority Leader Chuck Schumer (D-N.Y.), he and other Capitol Hill leaders will work with appropriators to ensure the $20 billion for infrastructure and funding for other priority non-construction items are included in upcoming spending bills. That work will start soon, as appropriators work on a spending measure for the rest of 2018.
The leaders' statement adds, “Specific spending decisions shall be left to members of the appropriations committees but the [congressional] leaders will work to ensure that the resulting legislation complies with the terms and spirit of this agreement.”
For infrastructure, the leaders said the $20 billion should go to programs that include “rural water and wastewater, clean and safe drinking water, rural broadband, energy, innovative capital projects and surface transportation.”
But it will up to appropriators to actually commit to spending the $20 billion and determine how to split up that total among various infrastructure areas.
Jimmy Christianson, Associated General Contractors of America vice president for government relations, says, “We appreciate that this agreement has been put in place but…we’re not resting on our laurels that if we don’t fight for [the infrastructure funds] in 2018 and 2019 that it’s just going to be given to us.”
ACEC’s Hall says, “This is not a substitute for a larger infrastructure effort. But if it means that the baselines for various infrastructure accounts get increased, that’s a good thing.”
He says ACEC sees the $20 billion as “a mechanism for orderly spending this year and next.”
Another key part of the package for construction is the $89.3-billion disaster relief section.
Big Corps Infusion
The Army Corps of Engineers civil works program, and contractors and design firms that pursue those projects, are big winners. The measure provides $17.4 billion in appropriations for the Corps, including $15.1 billion for the Corps construction account.
That construction allocation is “is just an enormous shot in the arm” for the program, says John Doyle, special counsel for law and lobbying firm Jones Walker LLP.
Doyle, a former senior Army civil works official, observes that the $15 billion represents several times the Corps construction account’s recent annual construction appropriations and is larger than the Corps’ post-Katrina reconstruction funding.
In addition, the measure includes $810 million for the Corps’ flood control and coastal emergencies account, $770 million for infrastructure repairs and construction in the Mississippi River basin; and $608 million for operations and maintenance items.
Moreover, Doyle observes that the new spending bill provides “almost unprecedented flexibility” for how the Corps uses the $15 billion in construction money. It says that funds should go for states like Texas and Florida that were battered by 2017 hurricanes, but doesn’t restrict the aid only to areas hit directly by last year’s storms.
HUD, FHWA post-disaster aid
Construction companies also may benefit from the disaster-aid measure’s $29.8 billion for Housing and Urban Development Dept. community development block grants, which can be used for infrastructure projects and a variety of other uses.
The legislation also has $1.3 billion for the Federal Highway Administration’s emergency relief program for post-storm road and bridge repairs.
Other allocations include $720 million to repair military facilities damaged in Corpus Christi, Texas; Key West, Fla.; and in Puerto Rico and the U.S. Virgin Islands.
There also are about $258 million for reconstruction and repairs of National Park Service and Fish and Wildlife Service facilities; $126 million for General Services Administration federal buildings repairs; and $75 million to repair storm damaged Dept. of Veterans Administration facilities in Texas, Florida and Puerto Rico.