SupplyChainBrain Interviews Jim Burnley on Funding Critical Infrastructure Projects in 2021

2 min

On January 21, 2021, Jim Burnley was featured on SupplyChainBrain, where he discussed the chances for progress on funding and construction of critical infrastructure projects under the new Biden administration.

Infrastructure ranks “very close to the top of the list” of priorities for President Biden in his early days in office, Burnley says. In fact, there’s long been a consensus among both major parties, and multiple administrations, about the need for progress in that area — in the abstract. Where things break down is in the details of what constitutes critical projects, and how to pay for them.

In 2020, the federal government engaged in heavy deficit spending to aid individuals and businesses suffering from the economic fallout caused by the coronavirus pandemic. “It’s like a war,” Burnley says. “You spend whatever you need to spend.” Once the virus is brought under control, however, there will be renewed concern by Congress over deficits, and legislators might balk at authorizing large amounts of money for infrastructure repair, maintenance, and construction.

Much of the debate will center around the Highway Trust Fund, which relies on a federal fuel tax that was last raised in 1993 and isn’t indexed to inflation. Meanwhile, the cost of infrastructure projects has soared. In addition, reliance on a gasoline tax no longer makes much sense, at a time when so many vehicles on the road are either hybrid or electrically powered. A new method of assessing the tax, such as one based on vehicle miles traveled (VMT), might be the answer, Burnley says. But with consensus among lawmakers difficult to achieve, he’s not optimistic that real progress on this long-debated issue will happen in 2021.

Click here to access the interview.