On November 15, 2021, Venable partners Jim Burnley and Fred Wagner were featured in a Q&A with Logistics Management on the Infrastructure and Investment Jobs Act and related issues. The following is an excerpt:
LM: In your opinion, what are the ramifications of this bill in terms of its bigger-ticket items, as well as what it may mean for the ongoing supply chain issues?
Burnley: This bill will have no discernible short-term impact on the supply chain. It does a few things with a broad brush. One is that it extends existing transportation programs for five years, which is very important. We were on the cusp of what could have turned into a series of very short-term extensions of the existing funds that work through the Highway Trust Fund (HTF) that has occurred in the past and when it goes on for a while it is very disruptive for the ability of states, transit agencies and others that depend on that federal flow of aid to do planning, much less execute contracts. It is also very good news that the bill includes a five-year set of extensions on those programs, at $110 billion on top of the five-year extensions. The extension matters; the overwhelming amount of the money in HTF is formula-driven and that keeps the spigot on for those programs. The new money, to a significant extent, does give DOT discretion, and that discretion will be different for different programs and defined differently.
LM: What happens next, in terms of managing expectations, for this legislation?
Wagner: The real challenge for the administration is going to be managing the expectations of finally coming to this day and not necessarily seeing orange cones on the street next week. The extension is imperative, because so much of the pipeline of these projects is based on planning and budget and budgeting. What we heard over and over again with absolute certainty is that it is very difficult to do that and what really may be the biggest benefit of this extension is that it really does provide that level of certainty for planners and engineers to move well forward into the next decade or beyond and that cannot be understated.
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