Seven things to know about the 1.2 trillion Infrastructure Investment and Jobs Act.
The $1.2 trillion bipartisan infrastructure legislation just signed into law by President Biden is expected to boost jobs and the economy while improving roads and bridges, bringing high-speed internet to rural areas, upgrading water infrastructure and much more in every corner of the country.1
None of this will happen overnight. First, federal agencies must create safe, fair ways to allocate and distribute the funds. State and local officials must decide where and how they will invest their shares, which will be distributed over the next five years. They will also need to oversee the design and construction of new projects, the first of which could begin to break ground as soon as next spring.1
In the meantime, here are seven things to keep in mind about this landmark legislation:
1. The nation’s crumbling roads and bridges are the biggest winners.
Of the approximately $9 billion earmarked for the State of Missouri over the next five years, more than two-thirds will go to road and bridge replacement and repairs. That should make a solid dent in the more than 400 unfunded road and bridge projects the Missouri Department of Transportation (MODOT) has already identified around the state. In the 2019 fiscal year, MODOT spent $1.5 billion on roads and bridges. A series of public meetings is schedule to seek public comments on projects under consideration.
By comparison, Kansas expects to receive a total of about $4 billion, with more than $2.8 billion tagged for roads and bridges over the next five years. Both states can also apply for additional funding through a $12.5 billion fund to fix important bridges and a $16 billion fund for road projects that spur economic development.2,3,4
In addition to repairs and replacements, some funds will be targeted to safety projects. For example, $11 billion is allocated nationwide for bike lanes and other improvements that help reduce accidents and fatalities involving cyclists and pedestrians.5
2. Public transportation will also get a boost.
The legislation includes funds to complete a multibillion-dollar backlog of public transit repair and replacement projects. Missouri and Kansas are receiving a combined total of nearly $1 billion for these projects, with an additional $140 million to be spent on expanding the states’ electric vehicle (EV) charging stations.6,7,8
Nationwide, thousands of school buses are expected to be replaced with zero-emission EVs. Another $66 billion is expected to fund passenger and freight rail improvements around the country. That is good news to Amtrak, which would likely be able to eliminate its sizeable maintenance backlog.9
3. Rural and low-income areas will receive high-speed internet.
Just as the federal government invested in bringing electricity to rural America nearly 100 years ago, today’s legislation includes $65 billion to bring high-speed internet to rural and low-income communities where more than 30 million Americans — roughly one in three rural households — cannot easily go online to connect to work, school and healthcare. Other funding will help low-income families afford internet access — another tool for helping eliminate the current digital divide.10
4. Lead water pipes will be replaced.
The infrastructure funding includes nearly $16 billion to replace lead water service lines across the country. This is especially important in states like Missouri and Kansas, where the risk of lead exposure in drinking water is greater than in almost any other state. In fact, only five states have more lead pipes than Missouri. One of those states, Illinois, will spend 10 percent of its $17 billion allocation to improve the state’s drinking and wastewater infrastructure.11
Nationally, a total of $55 billion has been allocated to water infrastructure upgrades. A similar amount will go to projects that protect water and wastewater systems from drought, floods and cyberattacks. The $65 billion allocated nationally to rebuild the electric grid won’t solve all the nation’s energy problems, but it will make it possible to build thousands of miles of new power lines and expand wind, solar and other forms of renewable energy.12
5. Airports, ports and waterways will become more competitive.
According to AirHelp’s Global Airport Ranking, not a single U.S. airport is currently ranked among the world’s top 35 airports.13 The nation’s ports and waterways lag other nations as well. Investments totaling $42 billion for airport and port projects can begin to reverse these trends. In addition to addressing repair and maintenance needs, projects will be designed to remove bottlenecks, expedite shipping, improve sustainability and other efforts that support the U.S. supply chain.
That’s not all. Other projects will support the environmental clean up contaminated sites and explore new clean and renewable forms of energy. It will not be enough to fill the $2.59 trillion investment gap that the American Society of Civil Engineers (ASCE) says is needed for the nation’s infrastructure to earn a solid B. But it’s a solid start.14
6. The pay-fors in the $1.2 trillion program do not rely on tax increases.
The five-year spending package will be paid for with a variety of sources, including unspent COVID-19 relief funds and unemployment insurance aid. Other funds will come from new Superfund fees, changes to cryptocurrency tax reporting requirements, sale of petroleum reserves and Federal Communications Commission spectrum auctions that sell wireless carriers the rights to build high-speed 5G networks.15 Even so, the Congressional Budget Office calculates the legislation will add about $256 billion to the deficit over the next 10 years.16
7. The economic impacts of the infrastructure spending are expected to be far-reaching and long-lasting.17
Independent analyses find that all these investments will create more than 800,000 jobs over the next decade, with few if any inflationary impacts. In Missouri alone, job creation is expected to number in the tens of thousands. The construction, steel, concrete and asphalt industries are all expected to be among the bigger winners.18,19
Long-term, improved highways and bridges, as well as a more resilient power grid and growing EV systems could also improve worker and supply chain efficiency. On a smaller scale, rural farmers should gain new opportunities with better high-speed internet access. Investments can address current needs, while also helping to attract new residents and development. In one way or another, they will impact every person in the country for years to come.
In other words, infrastructure spending is expected to be a gift that keeps on giving.
- Tomer, Adie, et al. (2021, November 9) America Has an Infrastructure Bill. What Happens Next? https://www.brookings.edu/blog/the-avenue/2021/11/09/america-has-an-infrastructure-bill-what-happens-next/
- Mahoney, Micheal. (2021, November 15) Kansas, Missouri Will See About $14 Billion In New Projects From Infrastructure Bill. https://www.kmbc.com/article/kansas-missouri-infrastructure-bill-projects/38256997
- Desrochers, Daniel. (2021, November 6) Congress Just Passed The Infrastructure Bill. Here’s Five Ways It Will Help Kansas And Missouri. https://www.mcclatchydc.com/news/policy/article254582347.html#storylink=cpy
- Skipworth, William, (2021, November 27) Infrastructure Bill To Bring $8 Billion To Missouri. https://www.emissourian.com/local_news/infrastructure-bill-to-bring-8-billion-to-missouri/article_
- White House Fact Sheet: Historic Bipartisan Infrastructure Deal. (2021, July 28). https://www.whitehouse.gov/briefing-room/statements-releases/2021/07/28/fact-sheet-historic-bipartisan-infrastructure-deal/
- Mahoney (2021).
- Desrochers (2021).
- Skipworth (2021).
- White House Fact sheet (2021).
- How Will the Infrastructure Bill Improve Internet Access for Americans? (2021) https://www.cs.columbia.edu/2021/how-will-the-infrastructure-bill-improve-internet-access-for-americans/
- West, Sandy. (2021, November 9). Drinking Through A Lead Straw’: Infrastructure Bill Includes $15B To Fix Dangerous Water Pipes. https://missouriindependent.com/2021/11/09/drinking-through-a-lead-straw-infrastructure-bill-includes-15b-to-fix-dangerous-water-pipes/
- Lobosco (2021).
- AirHelp Score 2019 (2019). https://www.airhelp.com/en/airhelp-score/airport-ranking/
- 2021 Report Card for America’s Infrastructure (2021). https://infrastructurereportcard.org/
- Summary of Tax Impacts in Proposed Infrastructure Bill. (2021, August 2). https://www.kcoe.com/summary-of-tax-impacts-in-proposed-infrastructure-bill/
- Wilson, Kristin, et al. (2021, August 5). CBO: Bipartisan Infrastructure Plan Will Add $256 Billion To Projected Deficits Over The Next Decade. https://www.cnn.com/2021/08/05/politics/bipartisan-infrastructure-plan-senate-cbo-score/index.html
- Lobosko, Katie. (2021, November 9). Here's How Long It May Take Biden's Infrastructure Package To Jolt The Economy. https://www.cnn.com/2021/11/09/politics/biden-infrastructure-bill-spending-economy/index.html
- Zandy, Mark, et al. (2021, November 4). Macroeconomic Consequences of the Infrastructure Investment and Jobs Act & Build Back Better Framework. https://www.moodysanalytics.com/-/media/article/2021/macroeconomic-consequences-of-the-infrastructure-investment-and-jobs-act-and-build-back-better-framework.pdf
- Economic Research: How U.S. Infrastructure Investment Would Boost Jobs, Productivity and the Economy. (2021, August 23). https://www.spglobal.com/ratings/en/research/articles/210823-economic-research-how-u-s-infrastructure-investment-would-boost-jobs-productivity-and-the-economy-12085911