The President on March 31 announced a $2.25 trillion, eight-year spending proposal. The “American Jobs Plan,” would fund transportation and water infrastructure, electric vehicles, technology research, climate R&D, electric grid modernization, workforce development, broadband internet, affordable housing, school improvements, and environmental justice initiatives. It would devote more than $600 billion to rebuilding infrastructure, such as pipes, ports, railways, bridges and highways; about $300 billion to support domestic manufacturing; and more than $200 billion to housing. At least another $100 billion would be spent on a national broadband system, the electric grid, upgrading educational facilities, and R&D.
It would aim to phase out fossil fuels, in part by extending a renewable energy tax credit for 10 years. A second spending plan, the “American Family Plan” -- is expected to direct funding to health care, childcare, paid-leave, child care and education at a cost of $1 trillion or more.
The first plan would increase the corporate income tax rate from 21 to 28 percent, hike income taxes on families and S corporations with income of $400,000 or more, increase capital gains taxes, restore the Superfund tax, and impose other tax-code changes. Deductions repealed in the 2017 tax-cut bill would not be restored. The proposal would not address the structural challenges facing Highway Trust Fund (HTF) sustainability or address a (HTF) funding shortfall that is occurring due to increased vehicle efficiency and the transition to electric vehicles.
A new National Association of Manufacturers (NAM) study found that the proposed tax hikes would cost Americans 1 million jobs within two years after implementation and lead to a loss of 600,000 jobs on average each year over the next decade.
AFS urges the Administration to narrow its spending package to focus more sharply on transportation and water infrastructure, and to adopt a financing strategy that will not so severely impact the economy and the employment prospects for working Americans.
Democratic leaders hope to pass the measure by July 4, which suggests a plan to go-it-alone using budget reconciliation, which requires only simple majority votes in both chambers. The sweeping proposal is unlikely to garner the support of Republicans, who have expressed disapproval at the size of the spending and the tax increases, and even some moderate Democrats are concerned with certain details.
Now, Democratic lawmakers will draft the actual text, filling in details around the broad policy pronouncements. There have already been several climate and infrastructure measures introduced in Congress that will likely be incorporated into the package. AFS has weighed-in on a number of these bills’ proposals. For a more detailed overview of the American Jobs Plan and provisions that would impact Metalcasters, see below.
For more information, contact Stephanie Salmon, Vice President Government Affairs, Washington office, ssalmon@afsinc.org
AFS Summary of the American Jobs Plan
The plan includes almost $1 trillion in investment in traditional infrastructure projects and another $1 trillion in education, workforce, and manufacturing initiatives, including these provisions of interest to metalcasters:
Transportation Infrastructure and Resiliency ($621 billion)
· $115 billion to modernize bridges and 20,000 miles of highways, roads, and main streets.
· $85 billion for transit.
· $80 billion for Amtrak’s repair backlog.
· $25 billion for airports.
· $50 billion to invest in improving resiliency of infrastructure by rebuilding above existing codes and standards and to protect infrastructure in communities that are most vulnerable to climate change.
· $174 billion to support the development and deployment of electric vehicle infrastructure, including building 500,000 EV charging stations by 2030, replacing 50,000 diesel engines from the transit fleet, and electrifying 20 percent of school buses.
· $25 billion for complicated transportation projects that would benefit a regional or the national economy but are not appropriate for existing programs.
· $20 billion for a new program to reconnect neighborhoods, often low income, or minority communities, that were physically divided by past transportation projects and cut off from broader economic opportunities.
· $20 billion to improve road safety, including a new Safe Streets for All program, and support for vision zero plans to reduce fatalities involving pedestrians and bicyclists.
· $17 billion for inland waterways and ports, including a Healthy Ports initiative to mitigate cumulative impacts of air pollution on neighborhoods near ports.
Water, Broadband, and Electric Transmission Infrastructure ($111 billion)
· $45 billion in the Drinking Water State Revolving Loan Fund and the Water Infrastructure Improvements for the Nation Act grants to replace 100% of the nation’s lead pipes and service lines for both homes as well as schools and childcare facilities.
· $56 billion in grants and low-cost loans for modernize drinking water, wastewater, and stormwater systems.
· $10 billion to monitor and remediate PFAS in drinking water and to invest in rural water systems and household well and wastewater systems.
Investments in Improvements to the Electrical Grid ($100 billion)
· Support for purchasing clean energy for federal buildings.
· Establishment of an Energy Efficiency and Clean Energy Standard to achieve 100 percent clean power by 2035 – the House Energy and Commerce Committee Democrats recently introduced the CLEAN Future Act, which would establish a clean energy standard and could serve as a template for how such a standard might be implemented
· Establishment of investment tax credit for the building of 20 gigawatts of high-voltage capacity power lines.
Environmental Justice
- Invests $10 billion in a new Civilian Climate Corps to create union jobs and promote diversity in public lands and waters conservation work.
- Provides $20 billion for a new program that will fund new projects in isolated neighborhoods to increase opportunity, advance racial equity, and environmental justice, and promote affordable access to infrastructure.
- Provides $5 billion in investment for the remediation and redevelopment of Brownfield and Superfund sites for economic development in distressed and disadvantaged communities.
- Dedicates funding for community-driven environmental justice efforts to address legacy pollution and the cumulative impacts experienced by frontline and fence line communities.
Retrofit Homes and Commercial Buildings and Reform Building Standards ($213 billion)
· $213 billion to produce, preserve, and retrofit more than two million affordable and sustainable places to live including:
o $40 billion to improve housing infrastructure addressing life-safety and imminent hazard concerns and improve energy efficiency.
o $20 billion worth of Neighborhood Homes Investment Act (NHIA) tax credits to build and rehabilitate about 500,000 homes for low- and middle-income homebuyers.
o $27 billion for a Clean Energy and Sustainability Accelerator to spur private investment into distributed energy resources; retrofits of residential, commercial, and municipal buildings; and clean transportation.
Modernize Schools, Community Colleges, and Early Education Facilities ($137 billion)
· $100 billion to upgrade and build new public schools, through $50 billion in direct grants and an additional $50 billion leveraged through bonds.
· $12 billion for community college facilities and technology with a focus on servicing education deserts in rural communities.
· $25 billion to help upgrade childcare facilities and increase the supply of childcare.
Upgrade Veterans Hospitals and Federal Buildings ($28 billion)
· $18 billion for the modernization of Veterans Affairs hospitals and clinics.
· $10 billion to support investment in a major purchase, construction, or renovation of Federal facilities through a bipartisan Federal Capital Revolving Fund.
Support for Research and Development ($180 billion)
· $50 billion for the National Science Foundation for advanced technology jobs manufacturing and programs.
· $30 billion for research and development to spur innovation and jobs.
· $35 billion for research and new technology to address climate change.
· $5 billion for climate focused research.
· $40 billion for improvements to laboratories at federal research centers and Historically Black Colleges and Universities.
· $15 billion for research and development demonstration projects, including utility scale energy storage, floating offshore wind, and carbon capture.
· $10 billion for research and development opportunities at Historically Black Colleges and Universities.
· $15 billion to crease 200 centers of excellence to serve as research incubators at Historically Black Colleges and Universities.
Support Transformation of Manufacturing Sector and Small Businesses ($300 billion)
· $50 billion to create a new office within the Commerce Department to oversee the nation's critical supply chains, whose vulnerabilities have been exposed during the coronavirus
· $50 billion for semiconductor manufacturing and research.
· $50 billion in investing in medical countermeasure research and manufacturing, including increases to the strategic national stockpile.
· $46 billion in federal purchasing power to drive innovation and transformation to net-zero emissions by 2050.
· $20 billion for regional innovation hubs to link urban and rural communities.
· $52 billion for domestic manufacturing through increased access to capital with a focus on supporting rural manufacturing and clean energy.
· $31 billion to improve access to capital and research and development funding for small businesses.
Workforce Development Initiatives ($100 billion)
· $48 billion for workforce development and apprenticeship programs.
· $40 billion for a new displaced workers program to support the transition to a clean economy.
· $12 billion for programs to assist workers facing the greatest challenges finding employment, including for formerly incarcerated individuals.
Expand Opportunities for Union Jobs
· Commit to increasing American jobs through Buy America and Ship American provisions.
· $10 billion to enforce standards related to fair and equal pay, safe and healthy workplaces, and workplaces free from racial, gender, and other forms of discrimination and harassment.
Reforms to the Tax Code
· Increase the corporate tax rate to 28 percent.
· Increase the tax rate on global intangible low-taxed income (GILTI) to 21 percent, require GILTI to be calculated on a country-by-country basis, and eliminate the GILTI exemption for the first 10 percent return on certain foreign assets.
· End the race to the bottom on corporate tax rates by seeking a global agreement on a strong corporate minimum tax.
· Eliminate tax deductions for offshoring jobs and provide tax credits to support onshoring jobs.
· Eliminate the tax incentives for foreign derived intangible income and provide more effective incentives for research and development investment.
· Enact a 15 percent minimum tax on the “book income” of large corporations.
· Expands Section 45Q tax credit for carbon capture with the goal of making the credit easier to utilize for industrial applications, direct air capture and retrofits of existing plants.
· Eliminate the tax preferences for the fossil fuel industry and restore payments from polluters into the Superfund Trust Fund to help cover the cost of cleanups.