By LSN Partners on December 2, 2022
On November 30th, the Senate Committee on Environment & Public Works held a hearing titled Putting the Bipartisan Infrastructure L
aw to Work: The Private Sector Perspective. Click the link to view the hearing and read the witness testimony Committee Hearing.
The committee received testimony from the private sector, who identified accomplishments and challenges they have faced with implementing the Infrastructure Investment & Jobs Act (IIJA). These challenges include ongoing supply chain shortages, labor shortages, permitting delays, and inflation. Despite these issues, there have been significant accomplishments and progress. President & CEO of the American Road & Transportation Builders Association, Dave Bauer, testified that the “key takeaway from the first year of the IIJA is that the law is working as intended, with state transportation departments disbursing their funds and projects breaking ground in communities across America.”
Jonathan Levy, the Chief Commercial Officer with Evgo, a leader in EV charging solutions, testified that the “competitive [EV] market, and ensuing investments, will be seen across 50 states, fueling job creation in jobs such as EV technicians, electricians, construction and more.”
Committee Chairman Sen. Tom Carper (D-DE) stated, “Our infrastructure programs could help reduce emissions from our transportation sector, that accounts for nearly 30% of greenhouse gas emissions nationwide. New programs could also improve the resilience of our transportation systems and reduce our vulnerability to extreme weather, such as the heat waves and flooding we continue to witness across our country and planet.” Democrats on the committee also highlighted the law’s potential for increasing highway safety, responding to climate change, and improving freight connectivity.
Shelley Moore Capito (R-WVA), the top Republican on the panel, again aimed certain guidance documents unveiled by agencies throughout the Department of Transportation (DOT). A focus of her concern is a December 16, 2021, memorandum from the Federal Highway Administration (FHWA), which suggests state agencies prioritize the maintenance of projects over proceeding with new projects. The Biden Administration has indicated that the memo’s purpose was to guide state agencies about federal resources.
Witnesses also testified that the Build America Buy America Act, enacted by Congress last year as part of the IIJA, lacks clarity about what is “American” and what is not. For example, Ali Mills, on behalf of the Associated General Contractors of America, stated that these “new requirements have created significant confusion among industry about the difference between a construction material and a manufactured product.” As a result, while waivers have been promised to the industry, other complications have ensued.
Throughout the hearing, witnesses testified to the economic benefits expected to impact the transportation sectors due to IIJA injecting billions of dollars in discretionary grants to state agencies.
Key Points from the Witnesses
Dave Bauer, President and Chief Executive Officer American Road & Transportation Builders Association – The first year of the Infrastructure Investment and Jobs Act is working as intended, with state transportation departments disbursing their funds and projects breaking ground in communities across America. Thirty-seven states saw an increase in the number of federal-aid projects and advanced larger projects in FY 2022 than in FY 2021. In total, 105 projects across 29 states saw $50 million + in federal investment compared to just 69 projects in 25 states in fiscal year (FY) 2021.
Matt Stanberry, Managing Director Highland Electric Fleets – In cases of technology transition, it isn’t easy to overstate the importance of building awareness and education around the new technology. While interest in electric school buses has evolved over the past several years, the IIJA and the Clean School Bus Program have generated broad awareness and knowledge building that has motivated action in places with little prior experience. In addition, the electrification as a service model enables ESB acquisition and operation at a cost equivalent to or better than traditional diesel total cost of ownership. The EaaS provider makes that possible by leveraging volume purchasing; asset depreciation; fuel and maintenance savings; grant, rebate, and utility programs; and other values ESBs can provide. As a result, EaaS is the only ESB acquisition model available today that drives project costs down and fundamentally reduces the amount of incentive funding necessary per bus to reach affordability.
Ali Mills, President Plum Contracting, Incorporated, Associated General Contractors of America – A recent survey of AGC members found that 93 percent of construction companies are experiencing long lead times and/or allocations (less-than-full shipments) for construction materials. Infrastructure project costs continue to climb amid rising construction materials prices and shortages. Material price increases have doubled or even tripled in some cases. The construction industry is facing material challenges that reach far and wide. Supply chain disruptions from the pandemic have inflated the cost of construction materials and made project delivery schedules and product availability more uncertain. As a result, crucial infrastructure projects across the country run the risk of delay. When able to, construction firms will pass along the prices of the rising materials to remain successful.
Jonathan Levy, Chief Commercial Officer, EVgo Services – The funding programs in BIL will induce a quicker buildout of EV infrastructure. Still, they alone cannot meet the Administration’s goal of building 500,000 chargers by 2030 and the broader aspiration of an all-electric future. The private sector must also come to the table with tangible commitments and real expertise to amplify federal dollars and ensure a nationwide charging network is operated and maintained to deliver for drivers over the long term. As program rules are finalized and future years of funding are obligated, U.S. and state DOTs should continue to adopt best practices and learnings from past State Energy Office and other charging programs to bolster new state DOT programs.
Gary W. Johnson, P.E. Vice President Land & Quarry, Granite Construction Company – The White House Council on Environmental Quality (CEQ) earlier this year issued a new regulation that complicates the permitting process for large infrastructure projects under the National Environmental Permitting Act (NEPA). This bureaucratic action broadens definitions and adds duplicative federal agency reviews that will do nothing to improve environmental outcomes. What is more frustrating is that these new rules run counter to the bipartisan NEPA reforms included in the Infrastructure Investment and Jobs Act (IIJA) which was signed into law last November. Aggregates suppliers across the country crave certainty as we work to supply the billions of tons of essential materials needed to improve roads, upgrade bridges, advance transportation systems and ports, and advance our modern energy infrastructure, which will be funded by the investments provided by the bipartisan IIJA. This is especially important in the current economic environment, where needless red tape will delay project implementation and drive-up costs of construction materials.