What Is the Infrastructure Investment and Jobs Act?
The $1.2 Trillion Infrastructure Investment and Jobs Act, signed into law by President Joe Biden, Nov. 15, 2021, includes $550 billion in new funding to rebuild roads and bridges, water infrastructure, resilience, internet, and more.
The 2,702-page bill, which received bipartisan support in both houses of Congress, originated in the House of Representatives on June 4, 2021. It was initially approved by the House by a vote of 221-201 on July 1, was sent back to the House after approval in the Senate on Aug. 10, by a 69-30 affirmative vote, then passed on to the president after approval by the House, 228-206, on Nov. 5, 2021.
- The Infrastructure Investment and Jobs Act was signed into law by President Joe Biden on Nov. 15, 2021.
- Generally referred to as the bipartisan infrastructure bill, this law authorizes $1.2 trillion in total spending, including $550 billion of new spending on hard infrastructure.
- The law also addresses climate change as it pertains to surface transportation.
- It revises Buy America procurement procedures for highways, mass transit, and rail.
- It implements new safety requirements for all modes of transportation.
- It directs the Department of Transportation (DOT) to establish a program to ensure the long-term solvency of the Highway Trust Fund.
Understanding the Infrastructure Investment and Jobs Act
In total, this law addresses federal aid for highways and transit; highway safety; motor carrier, research; hazardous materials; and rail programs of the Department of Transportation (DOT).
It also incorporates and extends through 2022 the 2021 federal-aid, highway, transit, and safety programs as well as the federal-aid highway program, transit programs, highway safety, motor carrier safety, and rail programs from 2023 through 2026.
In terms of new spending, the law authorizes:
- $110 billion for construction, repair, and research for roads and bridges
- $66 billion to upgrade and maintain the country\’s passenger and freight rail systems
- $65 billion to update power lines, prevent hacking of the power grid, and provide clean energy
- $65 billion to expand broadband in rural areas and in low-income communities
- $55 billion for lead pipe replacement, chemical cleanup, and clean drinking water in tribal communities
- $50+ billion to protect infrastructure from cybersecurity attacks and address flooding, wildfires, coastal erosion, other extreme weather events
- $39 billion to upgrade public transit, create new bus routes, and increase accessibility for seniors and the disabled
- $25 billion for upgrades and expansions of U.S. airports, control towers, and control systems
- $21 billion to clean up superfund and brownfield sites, abandoned mines, and old oil and gas wells
- $17 billion for port infrastructure and truck emissions at ports
- $11 billion to address highway, pedestrian, pipeline, and other safety areas
- $8 billion for western water infrastructure including mitigating drought conditions
- $7.5 billion for a nationwide network of electric vehicle charging stations
- $7.5 billion for electric school buses, primarily in low-income, rural, and tribal communities
Although proponents maintained that the Act would be paid for by a combination of new revenue and repurposing of unspent funds, the Congressional Budget Office (CBO) in August estimated the legislation would cost an additional $256 billion over 10 years.
Comparison With the Build Back Better Act
The bipartisan Infrastructure Investment and Jobs Act is half of a double-barreled Biden administration plan that also includes the $1.75 trillion+ Build Back Better Act or social infrastructure plan. Together, the passage of both laws would necessitate spending more than $3 trillion.
While the just-enacted Infrastructure Investment and Jobs Act legislation deals primarily with so-called hard infrastructure—including roads, bridges, waterways, and other physical structures—the Build Back Better Act is a social safety net and climate bill (although the Infrastructure Investment and Jobs Bill also contains climate-related provisions), that concentrates on such areas as:
- Childcare and universal preschool
- Family and medical leave
- Enhanced Child Tax and Earned Income Credits
- Home care for older Americans and those with disabilities
- Housing for low-income persons
- Higher education and workforce development for people whose incomes are below the poverty threshold
- Help for small businesses in disadvantaged areas
- Maternal health
- Community violence intervention
- Expanded nutrition programs
- State and Local Tax (SALT) deduction relief
- Lower-cost prescription drugs
- Expanded ACA coverage
- Medicare hearing aid coverage
- Lower consumer energy costs through greenhouse gas mitigation
- Immigration reform
CBO estimates of the cost of implementing Build Back Better were released Thurs., Nov. 18, 2021. The House of Representatives passed and sent the bill to the Senate on Fri., Nov. 19.
The CBO estimate said the legislation would increase the deficit by $367 billion over 10 years, but noted that the estimate does not take into account \”any additional revenue that may be generated by additional funding for tax enforcement.\”
The Treasury Department estimates that additional revenue to be $207 billion. By taking the additional revenue into account, the deficit becomes $160 billion or $16 billion per year.
What\’s the Difference Between the Bipartisan Infrastructure Plan and the Build Back Better Bill?
The bipartisan infrastructure plan involves investments in what\’s known as hard infrastructure such as roads, bridges, railroads, and shipping ports. Build Back Better proposes spending on human infrastructure including childcare, housing, nutrition, healthcare, and more.
What is an Offset in Legislation?
In legislation, an offset is an amount of money that \”offsets\” or is subtracted from spending or appropriations so that the appropriation is either reduced or eliminated. Some fiscal rules require appropriations to be entirely offset by savings through revenue, redirection of funds, or other means.
When Does the Infrastructure Investment and Jobs Act Go Into Effect?
The bill became law immediately after it was signed by President Biden on Nov. 15, 2021. When people ask this question, typically they mean \”When will the spending begin?\” Given challenges including those in the supply chain, analysts at the Brookings Institution could only say \”within months.\”