US business groups call on presidential candidates to prioritize infrastructure spending

Dive Brief:

Thirty-four organizations from the business, labor, transportation and travel industries have penned letters to major-party presidential candidates Hillary Clinton and Donald Trump, imploring each to make U.S. infrastructure investment a priority if elected, according to the Associated General Contractors of America.
Long-term, reliable funding strategies are necessary, the groups wrote, to upgrade the country's "aging" roads, highways and bridges — an initiative that could increase employment and spur economic growth.
The groups said they are ready to provide practical and political support to further an aggressive infrastructure-financing agenda and to guarantee "the long-term solvency" of the Highway Trust Fund, which provides most of the money for the country's surface transportation projects.

Dive Insight:

A Bloomberg report last month supported the notion that infrastructure improvements are not only necessary but also can provide an economic kick to cities. The report cited the Denver International Airport as an example, saying that a $2 billion investment in that facility 30 years ago created 270,000 jobs and continues to deliver a $26 billion economic benefit to the area each year.

With no durable solvency measures included in the last federal funding bill, local and state governments have had difficulty planning many infrastructure projects, the groups wrote to Clinton and Trump, which contradicts the measure's intent. Both candidates said they would increase infrastructure spending if elected, but neither has provided much detail. Clinton has touted a five-year, $275 billion plan that she says she will send to Congress within the first 100 days of her administration. She also said she would create a national "infrastructure bank" to achieve this goal. Trump said he would use bonds to invest "at least double" what Clinton proposed.

An August Construction Dive reader poll gave Clinton a 5% edge over Trump, which came as a surprise given that the industry has typically favored Republican candidates in previous elections.

Many cities and states, however, are not waiting on Washington to solve their infrastructure woes. Public entities have been taking advantage of record-low interest rates to finance portfolios of new projects through municipal bonds. The race to finance new projects, according to Barclays, has muni issues set to hit $400 billion by the end of the year. This is all part of an effort to meet what the American Society of Civil Engineers said is a $1.44 trillion infrastructure funding gap that could result in a $5.18 trillion shortfall by 2040.