Biden’s American Jobs Plan Proposes $2 Trillion in New Federal Spending

Published: April 01, 2021

Federal Market AnalysisAdministration TransitionCoronavirus (COVID-19) PandemicEnergy EfficiencyInformation TechnologyPolicy and Legislation

The plan is focused on U.S. transportation and energy infrastructure, but also includes wide-ranging technology, research and workforce provisions.

This week President Biden announced his economic vision and policy priorities for the U.S. in an address from Pittsburg, PA. Biden’s American Jobs Plan focuses primarily on U.S. infrastructure projects covering roads, bridges, water systems, and the electric grid, but is also presents his proposals for a wide variety of other priorities, from clean energy research and development (R&D) and high-speed Internet to quality housing and labor union expansion.

What follows is a detailed summary of the proposed provisions which Biden is calling on Congress to provide federal funding, plus related provisions that address organizational, regulatory and federal procurement for those areas.

Transportation Infrastructure

$621 billion in transportation infrastructure and resilience, including:

  • $115 billion to repair bridges, highways, roads, including funding to improve air quality, limit greenhouse gas emissions, and reduce congestion. The funds would also repair 20,000 miles of highways and roads, fix the ten largest, most economically significant bridges in the country, and repair 10,000 smaller bridges.
  • $20 billion to improve road safety, including increases to existing safety programs and a new Safe Streets for All program to fund state and local “vision zero” plans and other improvements to reduce crashes and fatalities, especially for cyclists and pedestrians.
  • $85 billion to modernize and expand public transit systems, doubling federal funding for public transit, including expanding local bus rapid transit and rail services.
  • $80 billion enhance passenger and freight rail service, including Amtrak repairs, improving the Northeast Corridor and others, and enhancing grant and loan programs that support passenger and freight rail safety, efficiency, and electrification.
  • $174 billion for electric vehicles (EV) to spur domestic supply, give sale rebates and tax incentives to buy American-made EVs, establish grant and incentive programs to build a national network of 500,000 EV chargers by 2030, replace 50,000 diesel transit vehicles and 20 percent of the yellow school buses, and electrify the federal fleet, including the United States Postal Service.
  • $25 billion for the Airport Improvement Program and a new program to support terminal renovations and multimodal connections for car-free access to air travel.
  • $17 billion for inland waterways, coastal ports, land ports of entry, and ferries, including a Healthy Ports program to mitigate the cumulative impacts of air pollution on neighborhoods near ports.
  • $20 billion for a new program to reconnect neighborhoods cut off by historic highway builds, increase opportunity, advance racial equity and environmental justice, and promote affordable access.
  • $25 billion for a dedicated fund to support transportation infrastructure projects that benefit the regional or national economy but are too large or complex for existing funding programs.
  • $50 billion to improve electric, transportation, food system and healthcare infrastructure resilience to damage and disruption from floods, wildfires, hurricanes, etc.; for restoring lands, forests, wetlands, watersheds, and coastal and ocean natural resources; and to support agricultural resources management and climate-smart technologies.

Water Infrastructure

$111 billion for improving water infrastructure and replacing lead pipes and service lines, including:

  • $45 billion to eliminate lead pipes and service lines in the country through the Environmental Protection Agency’s (EPA) Drinking Water State Revolving Fund and in Water Infrastructure Improvements for the Nation Act (WIIN) grants.
  • $56 billion in grants and loans to states, Tribes, territories, and disadvantaged communities to Upgrade and drinking water, wastewater, and stormwater systems, tackle new contaminants, and support clean water infrastructure across rural America.
  • $10 billion in funding to monitor and remediate industrial chemicals (e.g. per- and polyfluoroalkyl substances (PFAS)) in drinking water and to invest in rural small water systems and household well and wastewater systems, including drainage fields.

Broadband Infrastructure

$100 billion to expand to build high-speed broadband infrastructure to reach 100 percent of the country. The proposal also:

  • Prioritizes support for broadband networks owned, operated by, or affiliated with local governments, non-profits, and co-operatives and sets aside funds infrastructure on tribal lands
  • Proposes lifting barriers to municipally-owned or affiliated providers and rural electric co-ops from competing with private providers,
  • Promotes requiring internet providers to clearly disclose their prices.
  • Plans to work with Congress to reduce internet prices, increase adoption in both rural and urban areas, hold providers accountable, and save taxpayer money. 

Electricity Infrastructure

$100 billion to build a more resilient electric transmission system, including:

  • $16 billion for plugging oil and gas wells and restoring and reclaiming abandoned coal, hardrock, and uranium mines.
  • $5 billion for the remediation and redevelopment of Brownfield and Superfund sites, as well as related economic and workforce development efforts to build new physical, social, and civic infrastructure to these areas through the Economic Development Agency’s Public Works program, HUD and USDA “Main Street” revitalization efforts, the Appalachian Regional Commission’s POWER grant program, and Department of Energy retooling grants for idled factories.
  • $10 billion for a new Civilian Climate Corps to work conserving public lands and waters, bolstering community resilience, and advancing environmental justice.
  • Other proposed provisions include:
    • Clean energy market development through new production tax credits and the decarbonization of U.S. industry through an expanded Section 45Q tax credit to fund capital-project retrofits and installations.
    • The creation of a targeted investment tax credit that incentivizes the buildout of at least 20 gigawatts of high-voltage capacity power lines and mobilizes tens of billions in private capital.
    • Establishing a new Grid Deployment Authority at the Department of Energy to better leverage existing rights-of-way along roads and railways and to support creative financing tools to spur additional high priority, high-voltage transmission lines.
    • A ten-year extension and phase down of an expanded direct-pay investment tax credit and production tax credit for clean energy generation and storage.
    • Support for state, local, and tribal governments choosing to accelerate this modernization through complementary policies – like clean energy block grants that can be used to support clean energy, worker empowerment, and environmental justice.
    • Use of the federal government’s purchasing power to drive clean energy deployment across the market by purchasing 24/7 clean power for federal buildings.
    • Establishing an Energy Efficiency and Clean Electricity Standard (EECES) aimed at cutting electricity bills and electricity pollution, increasing market competition, incentivizing more efficient use of existing infrastructure, and continuing to leverage carbon pollution-free nuclear and hydropower while moving toward 100 percent carbon-pollution free power by 2035.

Affordable housing  

$213 billion to build, preserve, and retrofit more than two million homes and commercial buildings to address the affordable housing, combined with efforts to eliminate state and local exclusionary zoning laws and efforts to create well-paying jobs through project labor agreements. These efforts include:

  • $40 billion to improve the infrastructure of the public housing system to address life-safety concerns, mitigate hazards to residents, and increase energy efficiency to reduce operating expenses.
  • $27 billion to establish a Clean Energy and Sustainability Accelerator to mobilize private investment into distributed energy resources; retrofits of residential, commercial and municipal buildings; and clean transportation.
  • Extending affordable housing rental opportunities through targeted tax credits, formula funding, grants, and project-based rental assistance.
  • Proposing passage of the Neighborhood Homes Investment Act (NHIA) which would create $20 billion in NHIA tax credits over the next five years to stimulate the building or rehabilitation of approximately 500,000 low- and middle-income homes.
  • Proposing creation of a new competitive grant program that awards flexible and attractive funding to jurisdictions that eliminates zoning and land use policies – such as minimum lot sizes, mandatory parking requirements, and prohibitions on multifamily housing – deemed to inflate housing and construction costs and inhibit production of affordable housing.

Modernize Schools and Child Care Centers

  • $100 billion to upgrade and build new public schools – through $50 billion in direct grants and an additional $50 billion leveraged through bonds – to create cutting-edge, energy-efficient and electrified, resilient, and innovative school buildings with technology, labs and upgraded kitchens.
  • $12 billion for community college facilities and technology infrastructure for identifying strategies to address access to community college.
  • $25 billion to help upgrade child care facilities and increase the supply of child care through a Child Care Growth and Innovation Fund for states to build a supply and an expanded tax credit to encourage businesses to build child care facilities at places of work.

Upgrade VA hospitals and federal buildings

  • $18 billion to modernize Veterans Affairs hospitals and clinics.
  • $10 billion for the modernization, sustainability, and resilience of federal buildings through a Federal Capital Revolving Fund to support construction or renovation and using federal procurement policies to purchase low carbon materials for construction and clean power for new constructed VA hospitals and federal buildings.

Home Care for the Aged and Disabled and Support for Associated Workers

$400 billion to expand subsidies and access to quality, affordable home- or community-based care for aging relatives and people with disabilities. Funds would also increase wages and benefits for caregiving workers and expand home and community-based services (HCBS) under Medicaid.

Technology Research and Development (R&D)

$180 billion to advance U.S. leadership in new technologies – from artificial intelligence to biotechnology to computing – and upgrade U.S. research infrastructure, including:

  • $50 billion for the National Science Foundation (NSF) to create a technology directorate that will build on existing programs across the government, focusing on fields like semiconductors and advanced computing, advanced communications technology, advanced energy technologies, and biotechnology.
  • $30 billion for R&D that spurs innovation and job creation.
  • $40 billion to upgrade research infrastructure at laboratories, including brick-and-mortar facilities and computing capabilities and networks, allocated across the federal R&D agencies, including at the Department of Energy. Half of these funds would be reserved for Historically Black College and Universities (HBCUs) and other Minority Serving Institutions, including the creation of a new national lab focused on climate that will be affiliated with an HBCU.
  • $10 billion for R&D efforts at HBCUs and other MSIs and $15 billion to create up to 200 centers of excellence as research incubators at HBCUs and other MSIs to provide graduate fellowships and other education opportunities.
  • $35 billion for climate science, innovation, and R&D that addresses climate change and promotes clean energy technology and jobs. This includes launching an Advanced Research Projects Agency-Climate (ARPA-C) to develop new methods for reducing emissions, building climate resilience, and expanding across-the-board funding for climate research. An additional $5 billion is proposed for other climate-focused research.
  • $15 billion for demonstration projects for climate R&D priorities, including utility-scale energy storage, carbon capture and storage, hydrogen, advanced nuclear, rare earth element separations, floating offshore wind, biofuel/bioproducts, quantum computing, and electric vehicles, as well as strengthening U.S. technological leadership in these areas in global markets.

Manufacturing, Supply Chains and Small Businesses

$300 billion to strengthen manufacturing supply chains for critical goods, including:

  • $50 billion to create a new office at the Department of Commerce dedicated to monitoring domestic industrial capacity and funding investments to support production of critical goods.
  • $50 billion for semiconductor manufacturing and research, as called for in the Creating Helpful Incentives to Produce Semiconductors for America (CHIPS) Act.
  • $30 billion over 4 years for investments in medical countermeasures manufacturing; research and development; and related biopreparedness and biosecurity to prevent the severe job losses caused by pandemics in the future.
  • $46 billion to spur clean energy manufacturing through federal procurement of electric vehicles and charging ports; and electric heat pumps for residential heating and commercial buildings; and critical technologies such as advanced nuclear reactors and fuel.
  • $20 billion for ten regional innovation hubs and a Community Revitalization Fund to build social infrastructure to support innovation and productivity. The regional innovation hubs would leverage private investment to fuel technology development, link urban and rural economies, and create new businesses in regions beyond the current high-growth centers. The Community Revitalization Fund will support innovative, community-led redevelopment projects that can spark new economic activity, provide services and amenities, build community wealth, and close the current gaps in access to the innovation economy for communities of color and rural communities.
  • $14 billion for the National Institute of Standards and Technology (NIST) to foster collaboration to advance technologies and capabilities critical to future U.S. competitiveness. Biden is also asking Congress to quadruple support for the Manufacturing Extensions Partnership to increase the involvement of minority-owned and rurally-located small- and-medium-sized enterprises in technological advancement.
  • $52 billion for increased capital investment in domestic manufacturers through existing capital access programs, with a focus on supporting rural manufacturing and clean energy and modernizing supply chains. The plan also proposes creating a new financing program to support debt and equity investments for manufacturing to strengthen supply chains.
  • $31 billion to create a national network of small business incubators and innovation hubs that give small businesses access to credit, venture capital, and R&D dollars.
  • $5 billion for a new Rural Partnership Program to help rural regions and Tribal communities to create jobs and economic growth by supporting locally-led planning and capacity building efforts.

Workforce Training

$100 billion for workforce development programs targeted at underserved groups and career-pathing for high school students, including:

  • $40 billion for a new Dislocated Workers Program and sector-based training to provide comprehensive services for displaced workers to gain new skills for growing, high demand sectors such as clean energy, manufacturing, and caregiving.
  • $12 billion for workforce development opportunities for underserved communities, such as formerly incarcerated individuals and justice-involved youth and in improving public safety, including $5 billion over eight years in support of evidence-based community violence prevention programs. The plan also proposes a new subsidized jobs program, the elimination of sub-minimum wage provisions in the Fair Labor Standards Act, and expanded access to employment opportunities and fair wages for workers with disabilities.
  • $48 billion for workforce development infrastructure and worker protections, including creating up to two million new registered apprenticeships; strengthening access for more women and people of color through pre-apprenticeship programs; creating career pathway programs in middle and high schools that prioritize computer science and STEM programs; fostering job training programs at community colleges; and funding capacity increases at U.S. labor enforcement agencies.

Worker Protections and Labor Union Provisions

  • $10 billion for federal enforcement of workplace protections to ensure employers are providing workers with fair and equal pay, safe and healthy workplaces, and workplaces free from racial, gender, and other forms of discrimination and harassment. The plan also proposes increased penalties when employers violate workplace safety and health rules.
  • Biden also strongly advocates for increased labor union participation by urging Congress to pass the Protecting the Right to Organize (PRO) Act and by guaranteeing union and bargaining rights for public service workers. The plan also demands that employers benefitting from the proposed investments in the plan follow strong labor standards and remain neutral when their employees seek to organize a union and bargain collectively.

Updated Corporate Tax Proposals

Biden included with his American Jobs Plan a proposal to alter the U.S. corporate tax code to raise corporate taxes to finance the increased federal spending and address a number of areas that the administration sees as necessary to fulfil its priorities, including Made in America provisions. Some of the key tax proposals include:

  • Increasing the U.S. corporate tax rate to 28 percent.
  • Discouraging Offshoring by increasing the Global Minimum Tax for U.S. multinational corporations to 21 percent. The administration is also proposing to encourage other countries to adopt strong minimum taxes on corporations to reduce tax havens.
  • Discouraging offshoring of jobs and through reduced loopholes and deductions.
  • Eliminating tax preferences for fossil fuels and requiring polluting industries pay for environmental clean-up. 
  • Increase enforcement against corporations by ensuring that the Internal Revenue Service has the resources it needs to effectively enforce the tax laws against corporations. The administration plans to announce in the coming weeks a broader enforcement initiative that will address tax evasion among corporations and high-income Americans.