At the CG/LA Global Infrastructure Leadership Forum Dan Slane, the director responsible for infrastructure in the Trump Transition Team, described his report which he completed and delivered January 20 this year. In his view the only way to get the U.S. economy going again, by improving productivity and delivering 4 million high quality jobs (paying $60-80 000 for high school graduates), is infrastructure investment. Slane said that the the biggest impediment to infrastructure development is permitting. In the U.S. on average it requires 9.5 years to get the necessary permits in place for an infrastructure project. It involves many federal and state agencies and can take up to 15 years. The U.S. presidential term is 4 to 8 years, which means that presidents are not able to show significant results during their term in office from focussing in infrastructure. Their successor reaps the benefits politically.
When asked by President Trump to propose an infrastructure strategy, he decided to take a business approach and assess projects based on five criteria. The investment had to generate high quality jobs for high school graduates in disadvantaged geographical areas.
1) Fix the worst of the worst - fix the bridges like the one in Minnesota before they collapse.
2) Fix productivity of America - find those infrastructure bottlenecks that inhibit economic progess. He gave an exmaple of a lock on the Mississippi River that takes ships two days to get through.
3) Defensive projects - these are projects that are designed to prevent storms from seriously impacting the oil and gas facilities on the Louisiana Coast or New York transportation hubs.
4) National defence - projects like cyber security that are designed to prevent disruption of the U.S. energy grid by enabling redundancy
5) Next gen - projects that contribute to the development of the infrastructure of the future
He, Norman Anderson, President & CEO the CG/LA, and others winnowed 240 major projects down to 100 initially and then later down to 52 projects. They asked the Boston Consulting Group to verify the cost benefit analyses for these projects. It was estimated that the total cost of the 52 projects was $2.5 trillion and the investment would generate 500 000 direct high quality jobs. It could not be done without private investment funding.
The biggest hurdle to getting these 52 projects underway is permitting. To speed the permitting process up Dan Slane proposed that the president issue an executive order mandating the 13 federal agencies who needed to be involved in the permitting of the 52 projects had to complete the permitting within four months. The objective was to force agencies to collaborate and work in parallel and not sequentially. That proposal may not have been perceived as practical.
More recently an advisory council advising U.S. President Donald Trump on infrastructure and led by Richard LeFrak and Steve Roth has proposed an arbitration-style pilot program to significantly reduce the 9.5 years it takes on average to complete permitting. The idea is not to get around environmental and other regulations but to speed up the process using an arbitration approach. According to Reuters the advisory council made the suggestion to Trump and others in the White House last week.
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