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April 13, 2011 - ASCE Letter - Infrastructure Cuts in Chairman Paul Ryan's (R-WI) FY 12 Budget Proposal

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April 13, 2011

Dear Chairman Ryan,

The nation faces a number of significant deficits and one not addressed by the “Path to Prosperity” is the infrastructure investment deficit. While the American Society of Civil Engineers (ASCE) understands the fiscal predicament of the nation, cutting investments in public infrastructure which will grow the economy, create jobs, reduce the deficit, and permit the nation to compete globally, will lead to adverse affects in the years to come. The “Path to Prosperity, Restoring America’s Promise”, makes many difficult choices in order to reduce the annual deficit, however it does little to focus on those federal level investments in public infrastructure that can keep the nation on the road toward prosperity.

ASCE’s 2009 Report Card for America’s Infrastructure assigned a cumulative grade of D to the nation’s infrastructure and noted a five-year investment need of $2.2 trillion from all levels of government and the private sector. On a positive note, nearly half of that $2.2 trillion is already being invested by all levels of government and the private sector to attempt to bring the nation’s current infrastructure from falling further behind. Since ASCE’s last assessment in 2005 there has been little change in the condition of the nation’s roads, bridges, drinking water systems and other public works, and the cost of improvement has increased by more than half a trillion dollars. By continuing to delay these investments, or even worse cut these investments, the needs will only increase as the nation’s infrastructure crumbles.

As stated in the Roadmap 2.0 “some government spending is necessary to foster a functioning market economy. Governments must provide for a limited set of public good: they must build roads and other infrastructure…this core government spending tends to foster economic growth.” While the spending recommendation states that infrastructure programs should be funded at levels the trust fund supports, there is no mention of how to make infrastructure trust funds more solvent in order to support needed increased investment in programs, which will foster economic growth. Instead the proposal locks in all domestic discretionary funding at fiscal year 2008 levels for the next five years, creating a stagnant environment for infrastructure investment which will lead to a larger infrastructure deficit.

ASCE is disappointed at this shortsighted plan, which will likely delay critical infrastructure investments. Surface transportation programs can expect a decrease of approximately $17 billion annually, while funding for the Clean Water Act and Safe Drinking Water Act State Revolving Loan Funds (SRFs) would decrease to $700 million and $842 million from their FY 2010 enacted levels of $2.1 billion and $1.38 billion. It is important to note that these funding levels in FY 08 were far below what is needed to upgrade the nation’s aging public infrastructure systems. Reducing federal spending on these important infrastructure programs imperils the proven job creation potential that these investments possess.
Washington Office

Furthermore, ASCE is greatly concerned that the proposal anticipates Congress can keep the Highway Trust Fund solvent without additional general fund transfers or increases in the gas tax by consolidating highway programs that are duplicative. While ASCE agrees that there are duplicative programs which
can be consolidated, this will not create nearly enough savings to support the documented national needs. In fact, stating that the gas tax should not be increased is in direct contrast to the proposal from the bipartisan National Commission on Fiscal Responsibility and Reform, which recommended a 15 cent
gas tax increase in order to make the Highway Trust Fund no longer reliant on general fund transfers. The purchasing power of the current 18.4 cent gas tax is down 30 percent since it was last increased in 1993.

ASCE urges Congress to reconsider the importance of infrastructure investment in the FY 2012 budget proposal. As the legislation currently stands, ASCE opposes the budget resolution because of the significant funding decreases to vital infrastructure programs. Further investing in our nation’s infrastructure will allow the nation to continue to prosper by inducing economic growth and job creation and building a nation prepared for the twenty-first century. While we agree that the nation is faced with many tough decisions at this time, it is still imperative to make those investments that will grow the economy and benefit the citizens and the economy for years to come.

Sincerely,

Kathy J. Caldwell, P.E., F. ASCE