US Republicans unveil $928 billion infrastructure counter-offer to Biden govt's proposal

The plan came from a group of six Republicans led by Senator Shelley Moore Capito (pictured).
The plan came from a group of six Republicans led by Senator Shelley Moore Capito (pictured).PHOTO: AFP

WASHINGTON (REUTERS) - US Senate Republicans unveiled a new infrastructure offer on Thursday (May 27) that would spend US$928 billion (S$1.22 trillion) over eight years to revitalise America's roads, bridges and broadband systems, still well below President Joe Biden's last proposal.

The plan, from a group of six Republicans led by Senator Shelley Moore Capito, represents their counter-offer to a week-old US$1.7 trillion White House proposal that slashed more than US$500 billion from Mr Biden's original US$2.25 trillion plan in a bid to reach a bipartisan agreement.

Ms Capito said the offer delivers on the outline of a prospective infrastructure deal that Mr Biden laid out during a May 13 meeting at the White House, where Republicans say he mentioned spending US$1 trillion over eight years.

"Senate Republicans continue to negotiate in good faith," Ms Capito, top Republican on the Senate Environment and Public Works Committee, told a news conference while flanked by members of her negotiating team. 

A Mr Biden administration official said later that the proposal was being considered seriously. 

A primary reason for the gap between the two sides is that each has a different definition of "infrastructure."

Republicans want the Bill limited to physical assets, such as roads, airports and pipes, while the White House aims to include social spending programmes and education.

Mr Biden has imposed an unofficial end-of-May deadline on the negotiations, and some Senate Democrats have been pushing to go it alone if Republicans do not reach an agreement soon.

In a memo addressed to the president, the Senate Republicans expressed readiness to continue talking into June. 

"Your most recent offer leaves us far apart, and coupled with your Memorial Day deadline, leaves little time to close the gap," the memo said.

"We believe that we can reach a bipartisan agreement on infrastructure... We look forward to continuing our discussions around this framework."

The Republican proposal includes US$506 billion for roads, bridges and major projects, with another US$98 billion allocated to public transit. Just US$257 billion of the funds represented an increase over existing spending plans. 

Republicans proposed using funds previously authorised for Covid-19 relief to fill a US$575 billion gap between expected revenue from the US Highway Trust Fund and the offer’s US$928 billion top line.  

Senator Roy Blunt said Republicans are willing to consider other means of paying for the plan, including a fee on electric vehicles and nearly US$350 billion in "public-private" investments identified by business leaders. 

At a news conference on Wednesday, Deputy Press Secretary Karine Jean-Pierre had rejected the idea of repurposing already-authorised Covid-19 funding for infrastructure. 

"We should also be clear that there are simply not hundreds of billions of dollars in Covid-relief funds available to repurpose,” Ms Jean-Pierre said. 

Senator Pat Toomey rejected that argument at Thursday’s news conference: "Repurposing these funds needs to be a really important part of how we fill this gap... there’s more than we need."

Reaction among Senate Democrats was mixed. 

Senate Environment and Public Works Committee Chairman Tom Carper said he was encouraged by the proposal and called for negotiations to continue. 

Other Democrats flatly rejected the idea of using Covid-19 relief money for infrastructure as a non-starter, while Senate Banking Committee Chairman Sherrod Brown called the offer too small: "We want to go big, the public wants us to go big. They need to pay attention to what the public wants."

Ms Capito warned that any decision to move forward on a Democratic infrastructure plan without Republican support could have consequences for legislation down the road.

"A partisan reconciliation process would be destructive to our future bipartisan attempts," the West Virginia Republican said. 

Senate Democrats could pass a Bill without Republican votes through a process called reconciliation that bypasses the chamber’s rule that requires most legislation to have 60 votes to pass.

They did so earlier in the year to pass a US$1.9 trillion Covid-19 relief bill. 

But with the chamber divided 50-50, every Democratic senator would have to agree to the manoeuvre.

Multiple moderates have raised concerns about using reconciliation again.

The White House has expressed willingness to negotiate on some of the finer details but has said it wants a large package that expands the definition of infrastructure to include items such as free community college and paid family leave.

To pay for it, the administration has said it is open to any ideas as long as they don't include asking Americans earning less than US$400,000 to pick up the bill.

Republicans initially proposed a US$568 billion, five-year plan and increased the top line to around US$800 billion over eight years when the two sides met on Capitol Hill on May 18, according to the lawmakers.