Curious as to what the new Infrastructure bill could mean for your business? In a nutshell, the $1.2 trillion bill aims to modernize the nation’s long-neglected infrastructure projects while also strengthening supply chains and creating as many as 1.5 million new well-paying union jobs.
In a statement praising President Joe Biden’s signing of the bill into law, U.S. Chamber of Commerce President and CEO Suzanne Clark said the bill would “help connect 14 million Americans to broadband, provide clean drinking water for 10 million families, upgrade our energy grid, and create millions of jobs.”
Breaking down that massive $1.2T into broad categories, the bill allocates $21 billion for environmental efforts; $39 billion for public transportation; $65 billion for power; $65 billion for broadband; $105 billion for water systems; $108 billion for railways, airports and ports; and $110 billion for roads and bridges.
Below is a distillation of the bill’s chief elements of interest for businesses:
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The Employee Retention credit has ended
The ERC is a federal tax credit that incentivized employers to keep workers on their payrolls throughout the COVID-19 pandemic by providing a refundable tax credit against qualified employee wages. While the ERC was originally intended to last until the end of 2021, part of the Infrastructure bill mandated that the program end early. The ERC has expired as of Sept. 31, 2021, so wages paid beyond September are not eligible.
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More funding for minority-owned businesses
The Minority Business Development Agency, a federal agency that helps minority-owned businesses access government access and capital, will receive $110 million each year through 2025 versus the $48 million it received in 2021. Most of the funding will be slotted for its Business Center Program to help minority entrepreneurs with technical assistance and community referrals.
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Investment in construction
“The infrastructure bill will present an opportunity for private companies to create public-private partnerships that will amplify the funding in the bill, as well as fortify infrastructure as a stable asset class that’s able to deliver the long-term, reliable returns private capital investors look for,” said Murray Rowden, global head of infrastructure at Turner & Townsend.
How the bill invests in construction:
- $17 billion for shoring up port infrastructure.
- $25 billion for airports’ renovations.
- $110 billion for rebuilding roads and bridges.
- $226 billion for new transportation projects like light-rail line extensions, redesigned intersections, and protected bike lanes.
- $66 billion for railway expansion and upgrades.
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Investment in telecommunication
The bill commits the following investment for deploying broadband networks:
- $65 billion toward broadband infrastructure.
- $42.5 billion to expand access to high-speed networks.
- A subsidy of $30 a month to help low-income households pay for high-speed internet service.
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Investment in energy-efficient devices, solar power
The bill provides homeowners with a rebate of $2,000 for repairs that save 20% to 35% on their monthly energy costs or a $4,000 rebate if that number exceeds 35%. Thus, it encourages people to upgrade to energy-efficient devices.
The bill also increases subsidies for solar panel installations to 30%, encouraging more people to install solar panels. Further, it incentivizes companies to build plants and begin manufacturing their solar equipment in the U.S. to support solar industry growth.
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Investment in the electric vehicle industry
The bill’s intent to create infrastructure for electric vehicles will ensure long-lasting demand for battery-powered cars, even outside dense city centers, said Kristin Dziczek, senior vice president for research at the Michigan-based Center for Automotive Research.
The bill pledges the following investments toward clean energy and electric vehicles:
- $7.5 billion for building a nationwide network of electric vehicle chargers.
- $36 billion to develop technology for cleaner energy.
- $5 billion for replacing buses with zero-emission vehicles, including electric school buses.
- A tax credit of up to $12,500 for purchasing electric vehicles.
