Infrastructure Investment & Jobs Act's Impact on Printers

President Biden signed the “Infrastructure Investment and Jobs Act” (IIJA) into law on November 15th, an act of Congress that represents the largest federal investment in infrastructure in over a decade. The wide-ranging (1,039 page) legislation dedicates approximately $1.2 trillion to “hard” or “traditional” infrastructure, such as roads and bridges, power grids, rail, public transit, airports, ports, and more. Funding is also allocated to climate resiliency and environmental remediation. (For a breakdown of IIJA funding allocation, see the chart and analysis provided by Denton’s here.)

The distinction between “hard” and “soft” (or “human”) infrastructure was an important and controversial policy debate early in the legislative process. The latter piece, which focuses heavily on labor, education, and other social spending and health care programs, such as Medicare, was originally included in the bill. However, that massive bill and the attempt to redefine the meaning of traditional infrastructure lacked Republican support. By separating the two, the Biden Administration is able to legitimately claim a big bipartisan victory. (The “soft” infrastructure piece is now the basis of the “Build Back Better Act” languishing in Congress.) The IIJA was widely supported by both Main Street and Corporate America, along with the vast majority of business and industry trade associations and labor unions.

The focus in Washington, D.C., now switches from legislating to implementing the new law. The Departments of Transportation and Energy have the lion’s share of work to do in this respect, but agencies responsible for agriculture, environment, and commerce will also be tasked with standing up programs and spending (and tracking) newly allocated dollars. This responsibility will trickle down to states and localities, which often have the direct job of designing, approving, and executing infrastructure projects. (A suite of infographics breaking down the federal and state spending mechanics published by McKinsey can be viewed here.) The Office of Management and Budget (OMB) will also be busy, too, as the IIJA creates a new “Made in America” office tasked with implementing Buy America preferences in iron, steel, and other construction materials, as well as a “BuyAmerican.gov” website.

While the new law will affect a vast array of industries, here are a few key points for print and packaging manufacturers to note:

• IIJA is not necessarily a quick stimulus bill designed to fund “shovel ready” projects. Rather, it represents a major generational investment and longer-term philosophy of how the federal government will fund comprehensive “hard” infrastructure going forward.
• Supply chain woes – which printers and packagers are feeling acutely today – won’t be remedied immediately by enactment of IIJA. Again, the majority of spending in the new law will take months (or years) to implement. Certainly, there are positive long-term provisions that will lessen port, trucking, and rail supply chain crises in the future, but the law is intended as a short-term economic jolt.
• Efforts to improve USPS’ transportation efficiency were included as part of IIJA. Specifically, $8.98 billion was allocated to the federal procurement of electric vehicles to modernize the Postal Service’s fleet. This will serve to improve the outlook of USPS’ finances going forward, as the aging fleet of vehicles are considered to be a cost drain.
• Printers who pivoted (and perhaps stayed) into production of PPE during the height of the COVID-19 pandemic should note that the IIJA incorporated language from the “Make PPE in America Act,” which will require that PPE procured by the Departments of Homeland Security, HHS and VA be domestically produced via two-year minimum contracts. OMB is also instructed to publish a report outlining long-term strategies for US-produced PPE.
• Sustainability was addressed by IIJA by means of incorporating the bipartisan Senate “RECYCLE Act,” supported by PRINTING United Alliance, which authorizes and fully funds for five years a new federal grant program through the EPA focused on educating households and consumers about residential and community recycling programs. The printing industry has endorsed recycling education as a key pillar that must be included in any legislation focusing on paper and plastics recovery.
• While offsets to pay for IIJA included repurposing billions of unused COVID-19 relief funds (such as unclaimed PPP loans, unused state funds for enhanced UI supplements, and unused paid and family leave tax credits), the law also enacts new fees and taxes to fund new spending. Of note is the reinstatement of the Superfund tax on certain chemicals beginning in July 2022 and expiring at the end of 2031. PRINTING United Alliance had voiced concern to Congress regarding taxing inputs used for inks and printing processes; however, the more than $14 billion associated with the Superfund tax “revenue raiser” to fund the popular provisions in IIJA proved too difficult for Congress to resist. (A list of chemicals included in the Superfund tax can be found in the table by JDSupra here.)

On balance, the IIJA represents a historic achievement and investment in our country’s infrastructure that will enhance commerce, manufacturing, and lives of individuals overall. The deployment of IIJA funds and execution of new programs will be a massive effort that plays out over the next several months and even years. PRINTING United Alliance will continue to monitor the roll out of IIJA and its potential impact on the printing and packaging industry. In the meantime, for an extended analysis of the IIJA beyond the printing industry perspective, see Akin Gump’s report here (PDF).

Lisbeth Lyons is the Vice President, Government & Political Affairs at PRINTING United Alliance. In this article, Lisbeth addresses the Infrastructure Investment & Jobs Act. More information about delivery and logistics policy can be found at www.sgia.org or reach out to Lisbeth should you have additional questions specific to how these issues may affect your business: llyons@printing.org.

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