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Biden administration calls for USD621 billion in transportation investment, US [free access]

March 31, 2021

The Biden administration has released a proposal for a USD2 trillion job and infrastructure plan spanning a period of eight years. The proposal includes two plans. The American Jobs Plan will create jobs and rebuild the country’s infrastructure, and the Made in America Tax Plan will fund the investments called for in the American Jobs Plan.

 

The American Jobs Plan calls for USD621 billion in transportation investment and is expected to double the federal investment in public transit. Proposed investments the transit industry is expected to benefit from include USD85 billion directly in public transit; USD80 billion to address Amtrak’s repair backlog, modernize the Northeast Corridor, among other passenger rail investments, as well as enhance grant and loan programs for both passenger and freight rail; USD115 billion to modernize the bridges, highways, roads, and main streets that are in most critical need of repair; and USD20 billion to improve road safety for all users, including increases to existing safety programs and a new Safe Streets for All program to fund state and local “vision zero” plans and other improvements to reduce crashes and fatalities, especially for cyclists and pedestrians.

 

The plan includes USD174 billion for domestic investments in electric vehicle (EV) and battery manufacturing to facilitate the transition of 50,000 diesel transit buses to zero-emission bus technologies. It is also expected to increase EV manufacturing jobs, provide a boost to the domestic EV market, lay the foundations for a nation-wide charging network (500,000 EV chargers 2030), and electrify the federal fleet. The plan will also provide a four-fold increase in investment in rail projects across the US.

 

The US Department of Transportation estimates a repair backlog of over USD105 billion. The administration will modernise the public transit system, which will reduce the backlog of repair projects and connect more communities through buses, bus rapid transit (BRT) lines, and rail services.

 

The Made in America Tax Plan will provide funds for the American Jobs Plan, over a period of 15 years, by closing several corporate tax loop holes. Under the tax plan, the administration plans to set the corporate tax rate at 28 per cent. Additionally, the plan will raise the global minimum tax rate to 21 per cent. The administration will encourage other countries to tax corporations appropriately to discourage the development of tax havens. The rule allowing US companies to pay zero taxes on the first 10 per cent of return (for investments located in foreign countries) will also be eliminated. Lastly, subsidies for the fossil fuel industry will also be eliminated.