April 29, 2019 / 4:11 PM / 7 months ago

Democrats insist on 'substantial' new revenue for U.S. infrastructure

WASHINGTON (Reuters) - A day before heading to the White House to meet with President Donald Trump, top Democrats in Congress on Monday said a bill to boost U.S. infrastructure must be funded with “substantial, new and real revenue” to meet massive needs across the country.

FILE PHOTO: Speaker of the House Nancy Pelosi (D-CA) stands during a meeting with European Parliament President Antonio Tajani on Capitol Hill in Washington, U.S., February 27, 2019. REUTERS/Joshua Roberts/File Photo

In a letter to the president released ahead of their meeting on Tuesday morning, House of Representatives Speaker Nancy Pelosi and Senate Democratic Leader Charles Schumer outlined their priorities for draft legislation, which they said included renewable energy, broadband, water, school, and housing infrastructure.

They also called for investments in risk mitigation efforts for current infrastructure to handle the effects of climate change.

“We look forward to hearing your ideas on how to pay for this package to ensure that it is big and bold enough to meet our country’s needs,” they wrote.

Both Republicans and Democrats have supported taking measures to strengthen U.S. infrastructure, but the price tag and measures to pay for it may be a stumbling block to cooperation.

Trump economic adviser Larry Kudlow told reporters on Monday that the president had not made up his mind on whether to support raising a federal tax on gasoline to help fund an infrastructure package.

NO BLUEPRINT

Both sides are keeping expectations low for the meeting and no formal proposals are expected to be exchanged.

“We want to hear what they have to say about it, and we’ll react to that. But no, we’re not ... coming into it with a blueprint,” Kudlow said.

In a February 2018 meeting with lawmakers, Trump had endorsed hiking the federal gasoline tax by 25 cents per gallon to fund infrastructure improvements, Democratic Senator Tom Carper said.

The current tax of 18.4 cents a gallon on gasoline has been in place since 1993. The federal diesel tax is 24.4 cents a gallon.

Schumer said on Monday that the federal government could finance $1 trillion in infrastructure improvements by reversing some of Trump’s 2017 tax cuts and modestly boosting corporate tax rates. The tax bill is one of Trump’s signature legislative accomplishments.

“It would be extraordinarily unfair to ask the middle class to shoulder the cost of an infrastructure bill,” Schumer said.

The president, who vowed in 2016 to back $1 trillion of infrastructure spending over 10 years, has been vague about his plans in recent months.

In February last year, Trump asked Congress to authorize $200 billion in federal money over 10 years to spur road, bridge and other projects mostly funded by states, cities and the private sector. That plan was roundly criticized and never voted on in Congress, which was then controlled by Republicans.

An administration official confirmed that Trump was not a fan of that plan, which featured public-private partnerships, which he said Trump did not believe would work at the federal level.

Senate Majority Leader Mitch McConnell told reporters on April 11 that a big infrastructure boost is popular but “nobody on either side has stepped up with a credible proposal to pay for it.

“I’m all for taking it up once the president and Democrats, everybody says OK, here’s how we’re going to pay for it. As soon as that magically appears I think we have a way forward,” McConnell said.

Pelosi requested the meeting on infrastructure with Trump. Other Democrats expected to attend include Representatives Peter DeFazio, who chairs the House Transportation and Infrastructure Committee, and Richard Neal, who chairs the tax-writing Ways and Means Committee.

Senators Dick Durbin, Patty Murray, Debbie Stabenow, Ron Wyden and Carper will also attend, along with House Majority Leader Steny Hoyer, No. 3 House Democrat James Clyburn and Representative Ben Ray Lujan.

Reporting by David Shepardson and Jeff Mason; additional reporting by Richard Cowan; editing by G Crosse, Richard Chang and Bill Berkrot

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