August 12, 2021

After months of negotiations, the Senate on August 10 voted 69-30 to approve a massive bipartisan infrastructure package (HR 3684). The legislation, entitled the Infrastructure Investment and Jobs Act, includes a full surface transportation reauthorization bill, as well as funding for a broad array of infrastructure priorities. All told, the legislation would invest $550 billion in new spending over five years, and approximately $1.2 trillion over an eight-year timeframe.

Specifically, HR 3684 would authorize roughly $110 billion in new spending for roads and bridges; $73 billion for power grid upgrades; $66 billion for passenger and freight rail; $65 billion for broadband expansion; $55 billion for water infrastructure; $50 billion for resiliency and western water storage; $39 billion for public transit; $25 billion for airports; $17 billion for ports and waterways; $15 billion for electric vehicles; and, $11 billion for road safety.

Following passage of HR 3684, the chamber turned its attention to a much larger $3.5 trillion fiscal year 2022 budget resolution (S Con Res 14), approving the measure on a 50-49 party-line vote. The resolution includes instructions for lawmakers to craft legislation embodying the balance of President Biden’s economic agenda, known as the American Families Plan. It should be noted that Democrats plan to use the budget reconciliation process to advance the forthcoming “soft” infrastructure bill, which would insulate the measure from a GOP filibuster in the Senate.

While the budget resolution does not specify what the resulting reconciliation bill would contain, the document directs congressional authorizing committees to draft legislation that would, among other things: provide paid family and medical leave; provide low-cost, high-quality child care for working families; expand Medicare coverage to include dental, vision, and hearing benefits; and, provide universal pre-school and tuition-free community college. The resolution also calls for a series of measures to combat climate change. Among them are a “polluter fee” on imports for products’ greenhouse gas emissions, plans to electrify the federal vehicle fleet, and incentives for electricity suppliers to achieve President Biden’s goal of 80 percent clean power by 2030. It also specifically references expanding the state and local tax deduction and providing lawful permanent status for qualified immigrants.

The measure would be partially offset by increasing taxes on the wealthiest Americans and corporations. According to Democratic leaders, the proposed tax hikes would not impact small businesses, family farms, or families making less than $400,000 annually. Furthermore, the budget outline instructs committees to cut taxes for those making less than $400,000. Among the provisions is an extension of the child tax credit, which gives parents up to $300 per child per month.

Looking ahead, the deadline for the relevant congressional committees to write legislation to fulfill the spending targets set forth in the budget resolution is September 15. The multiple bills would then be bundled together by the House and/or Senate Budget Committees for floor debate as a single package. However, committee leaders cannot officially begin work on their respective portions of the package until the resolution is approved by both chambers of Congress. For their part, House lawmakers will interrupt their August break to vote on the measure during the week of August 23.

Finally, House Speaker Nancy Pelosi (D-CA) has reinforced that the House will not vote on the Senate’s bipartisan infrastructure bill until the upper chamber has passed a budget reconciliation package that contains the investments outlined in the president’s American Families Plan. As of this writing, at least two Democratic senators have expressed opposition to the $3.5 trillion soft infrastructure spending level, which will significantly complicate the legislative picture moving forward.