President-elect Donald Trump’s massive infrastructure package should have $40 of private-sector spending for every $1 of public spending, according to House Speaker Paul Ryan (R-Wis.)
“A great agency … has public-private partnerships. For every one dollar of federal dollars, there’s $40 of private sector spending,” Ryan said on the Charlie Rose Show. “We want to leverage as much private-sector dollars as possible to maximize the fixing of our infrastructure.”
It’s perhaps the clearest picture to date of whether — and how much — direct federal funding for transportation upgrades may be included in Trump’s promised $1 trillion infrastructure bill.
{mosads}There has been mounting concern, particularly among Democrats and rural Republicans, that relying on private financing would only attract projects that can recoup investment costs through tolls or user fees.
Ryan’s comments come after Trump’s nominees to lead the Commerce and Transportation Departments both voiced support for some public investment in transportation during their Senate confirmation hearings.
However, based on Ryan’s preferred ratio, private-sector dollars are still likely to make up a majority of the package, with public dollars only accounting for 2.5 percent.
Trump floated a blueprint on the campaign trail that would offer $137 billion in federal tax credits to private investors that back transportation projects, which he says would unlock $1 trillion worth of infrastructure investment over 10 years.
Ryan emphasized that although the price tag of Trump’s proposal is “eye popping,” that figure is only the overall investment level, not the cost of the legislation.
“That’s not a trillion dollars coming from federal taxpayers into the transportation system,” Ryan said. “That is the total amount we’re shooting for.”
But tax credits would still need to be fully paid for, Ryan said. Trump claims his plan would be revenue neutral thanks to taxes from new jobs and contractor profits, but economists have cast doubt on those assertions.
And any direct spending in the plan, which would be around $3.5 billion under Ryan’s vision, would definitely need an offset to pass the Republican-led Congress.
“Now we have to go about figuring out how to, in a fiscally responsible way, get that going,” Ryan said. “We have to cut spending elsewhere to pay for infrastructure.”
Trump has not yet defined which infrastructure needs he intends to upgrade, which could include everything from roads and bridges to power grids and broadband.
He has put together a team, lead by real estate developers Richard LeFrak and Steven Roth, to start identifying which projects should be targeted under any infrastructure proposal.
Ryan indicated on Wednesday that the plan would run the gamut.
“That’s airports, that’s pipelines, that’s roads, that’s bridges, that’s harbors, that’s canals,” he said. “All of them is essential.”