Senate Republicans announce $928 billion counteroffer on infrastructure

A group of Senate Republicans announced a $928 billion counteroffer on infrastructure on Thursday, a marked increase from their initial proposal. But their offer is still significantly smaller than the slimmed-down alternative to President Biden's original massive proposal and is focused solely on physical infrastructure needs that do not incorporate the president's priorities on bolstering "human infrastructure."

The proposal by a group led by Senator Shelley Moore Capito responds to some of the concerns raised by Mr. Biden during their meeting with him at the White House earlier this month. The Republicans had previously come back with a counteroffer of $568 billion, which many Democrats dismissed as too small.

Their new offer raises funding levels by $257 billion. "Senate Republicans continue to negotiate in good faith," Capito said in a press conference on Thursday. "We believe that this counteroffer delivers on what President Biden told us in the Oval Office that day, and that is to try to reach somewhere near $1 trillion over an eight year period of time."

The proposal includes $506 billion for roads, bridges and "major projects" — including $4 billion for electric vehicle infrastructure, $800 million for "reconnecting communities," and $14 billion for resilience, according to a fact sheet provided by Capito's office. Mr. Biden has made electric vehicle and other climate-related infrastructure a key priority.

The new Republican offer would increase baseline spending for roads and bridges by $91 billion; water infrastructure would see a $48 billion increase, for a total of $72 billion, and there would be a $22 billion increase over baseline spending for passenger and freight rail, bringing proposed funding on this up to $46 billion, according to the fact sheet. 

The proposal also contains a one-time increase of $25 billion for airports, raising the total to $56 billion, as well as an additional $6 billion for water storage in the West — raising that total to $22 billion.

The GOP measure also includes $98 billion for public transit, $22 billion for ports and waterways and $65 billion for broadband infrastructure, a priority for both parties.

Under this proposal, $21 billion would be spent on safety and $20 billion on infrastructure financing. 

The group of Republicans has suggested using unspent funds from previous coronavirus relief plans to pay for the infrastructure bill.

"We do believe that this money is available. If they have a different theory then they've got to show us the numbers," Senator Pat Toomey said on Thursday of the unused funding. Capito noted that several states will not be accepting monies for additional unemployment benefits, which could also be used to pay for an infrastructure proposal.

Some Republicans have also floated user fees, though this idea is unpopular with Democrats.

The Republicans say that Democrats can either accept their bipartisan proposal — or try to ram a larger bill through without any Republican support. Capito noted that the Senate Environment and Public Works Committee had recently approved two smaller infrastructure bills on a bipartisan basis, indicating that other priorities for the White House could be addressed in different, smaller legislation.

GOP Senator Roy Blunt said that Mr. Biden told the group that if Republicans wanted to break up infrastructure priorities into smaller bills, the president said, "I'll try to get the rest of it in some other way." Blunt also noted that this would be the "biggest infrastructure bill ever put on a president's desk by a Congress."

But White House Press Secretary Jen Psaki raised concerns about the Republican proposal in a statement later on Thursday, and particularly about how it would be funded.

"We remain concerned that their plan still provides no substantial new funds for critical job-creating needs, such as fixing our veterans' hospitals, building modern rail systems, repairing our transit systems, removing dangerous lead pipes, and powering America's leadership in a job-creating clean energy economy, among other things," Psaki said. "Lastly, we are concerned that the proposal on how to pay for the plan remains unclear: we are worried that major cuts in COVID relief funds could imperil pending aid to small businesses, restaurants and rural hospitals using this money to get back on their feet after the crush of the pandemic."

Psaki added that Mr. Biden "called Senator Capito thank her for the proposal, and to tell her that he would follow-up after getting additional detail." The president will meet with negotiators next week.

Capito told reporters after the call that it was "very positive," and said the president "wants to continue working."

Democratic Senator Tom Carper, the chair of the Senate Environment and Public Works Committee, said Thursday that he would suggest to the White House that Mr. Biden hold a meeting with the chairs and ranking members of the committees that have jurisdiction over infrastructure legislation: his committee, the Finance Committee, the Banking Committee and the Commerce Committee.

The White House proposed a $1.7 trillion counteroffer on infrastructure to Senate Republicans last week, roughly half a billion dollars less than Mr. Biden's initial $2.3 trillion proposal. However, Republicans said the most recent offer still included provisions that they don't consider to be related to "traditional" infrastructure needs, such as provisions on construction of veterans hospitals and on strengthening home care.

Mr. Biden had also proposed paying for a large infrastructure bill by raising the corporate tax rate to 28%, which Republicans oppose. The 2017 tax cuts bill signed by former President Trump lowered the corporate tax rate to 21%. 

Meanwhile, GOP Senator Mitt Romney is leading a separate bipartisan group of eight senators who are also working on an infrastructure proposal. Romney said on Wednesday that Capito's group was the "front burner" of negotiations, and that his group was on the "back burner."

"The White House proposal, the Republican proposal and ours are all quite close. As long as you look apples to apples, as long as you look same number of years and same number of items that are being financed," Romney told reporters on Thursday. "The challenge is always going to be in how you pay for it. And we've done some work on that with our group, and hopefully that can be helpful to the negotiations."

Senate Majority Leader Chuck Schumer indicated on Tuesday that, regardless of whether Republicans and Democrats come to an agreement, the Senate will move forward with infrastructure legislation in July.

Mr. Biden has also proposed a $1.8-trillion American Families Plan, which is focused on "human" infrastructure, with provisions on health care, child care and education. This proposal has also been received with skepticism by Republicans.