The Bipartisan Infrastructure Bill

In an increasingly rare moment of bipartisan unity, a group of Republican and Democratic Senators, along with President Biden, came to an agreement on an infrastructure bill. Infrastructure spending was long touted by President Trump, but somehow he and Congress never got a bill across the finish line. The current bill isn’t finalized either, but by getting over 60 votes in the Senate it overcame a filibuster, thereby clearing one of its largest hurdles.

So what’s in the bill? We’ll know more over time, as much of the 2000+ page bill was written over the weekend. But the big picture is that the bill includes $550 billion in new spending, roughly broken down as follows: 

1. $110 billion for roads, bridges, and major infrastructure projects, plus $11 billion for road safety and $39 billion for public transit
2. $66 billion for passenger and freight rail
3. $15 billion for electric vehicles and buses
4. $17 billion for ports, and $25 billion for airports
5. $50 billion for water infrastructure
6. $55 billion for clean drinking water, including the replacement of lead service lines and pipes
7. $65 billion for broadband internet infrastructure
8. $21 billion for environmental cleanup
9. $73 billion for power infrastructure

The mechanisms for paying for this spending are diverse and vague, which has probably eased passage of the bill. Repurposing of unused COVID relief funds, spectrum auctions, delayed implementation of a drug pricing rule, and tax reporting rule changes for cryptocurrency are among the ways Congress purports to cover the bill’s costs.

The path forward for infrastructure still has at least one major hurdle. Democrats are seeking to pass an additional massive infrastructure bill through reconciliation, a process that does not require Republican votes. House Majority Leader Nancy Pelosi has said that the House will only consider the bipartisan infrastructure bill once the reconciliation bill has passed the Senate as well. The Democratic bill could spend up to $3.5 trillion, and could provide funding for priorities such as childcare expansion, paid leave, health care subsidies, pre-K and higher education, green energy, green infrastructure, and tax credits for families. Assuming the reconciliation bill gets zero Republican votes, Democrats have a very narrow path—a single senator, or a handful of progressive or centrist House members could block passage. So as we head towards fall the question may not be whether President Biden signs the bipartisan infrastructure bill—it may be whether he signs two or none.

###

JMS Capital Group Wealth Services LLC
417 Thorn Street, Suite 300 | Sewickley, PA | 15143 | 412‐415‐1177 | jmscapitalgroup.com

An SEC‐registered investment advisor.

This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument or investment strategy. This material has been prepared for informational purposes only, and is not intended to be or interpreted as a recommendation.  Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice.