House passes $1.5tln infrastructure bill
Steel industry leaders applauded the US House of Representative’s passage of the $1.5-trillion Moving Forward Act, which provides for $494 billion in transportation infrastructure spending, on Wednesday July 1.
“The Moving Forward Act is a more than $1.5-trillion plan to rebuild American infrastructure – not only our roads, bridges and transit systems, but also our schools, housing, broadband access and so much more,” according to a fact sheet from the House Committee on Transportation & Infrastructure.
Steel Manufacturers Association (SMA) president Philip K. Bell told Fastmarkets that he was “pleased” with the House action.
“For us, it’s important to understand our nation’s infrastructure is in critical need of significant and long-term investment. We think infrastructure investment plays a very important role in getting our economy going, creating jobs and helping 21st century steelmakers with increased steel demand,” Bell said.
Kevin Dempsey, interim president and chief executive officer of the American Iron and Steel Institute (AISI), echoed that sentiment.
The House action “has helped highlight the importance of robust infrastructure investment in getting our economy moving again, especially for the steel industry,” Dempsey said. “An updated and efficient infrastructure network is paramount for our industry, not only to move goods to market but also to provide the steel needed to build and repair our nation’s crumbling roads and bridges.”
Bill features, concerns
If passed into law, more than $319 billion of the spending package would go to highway investment, and the bill prioritizes repairing 47,000 “structurally deficient” bridges. The bill calls for $105 billion in public transit investment to add new routes and provide more reliable service, and $60 billion in grants for rail investments.
In addition, states would be required to spend 20% of their National Highway Performance Program and Surface Transportation Program funds on bridge repair and rehabilitation.
The bill also features strong Buy America provisions, which SMA’s Bell called a “very critical” provision for the steel industry and the nation.
“We think our infrastructure should be built by Americans for Americans using American steel. It now appears Congress has affirmed that with the passage of this legislation,” Bell said.
But the bill also revealed a political divide on how to approach infrastructure spending. It passed in a 233-188 vote, failing to gain broad bipartisan support.
Senate Majority Leader Mitch McConnell (Republican, Kentucky) said the Senate would not take up the House-passed legislation because it “would siphon billions in funding from actual infrastructure to funnel into climate change policies.”
In contrast to the current bill, the Senate roughly one year ago unanimously passed the America’s Transportation Infrastructure Act of 2019, which was proposed by Senators Tom Carper (Democrat, Delaware), John Barrasso (Republican, Wyoming), Ben Cardin (Democrat, Maryland) and Shelley Moore Capito (Republican, West Virginia).
At the same time, President Donald Trump has called for a significant infrastructure investment.
“With interest rates for the United States being at ZERO, this is the time to do our decades long awaited Infrastructure Bill. It should be VERY BIG & BOLD, Two Trillion Dollars, and be focused solely on jobs and rebuilding the once great infrastructure of our Country!” Trump wrote on social media platform Twitter on March 31.
Industry leaders acknowledged the policy challenges facing the House legislation and called on the House, Senate and White House to work toward agreement on infrastructure spending.
“We are hopeful that today’s vote can help pave the way for eventual agreement between the House and Senate on infrastructure legislation that can be signed into law,” Dempsey said on Wednesday.
“It’s now essential we have bipartisan support, not only in the House, but also in the Senate and the White House to have meaningful infrastructure investment. I think the potential for this to happen exists,” Bell said.
When asked about the prospects for reconciling different infrastructure proposals to reach a consensus, Bell was upbeat.
“I’m optimistic and I’m hopeful, and if you’re the steel business, those are two traits you should always have,” he said.