Key Takeaways:

  • Green investments from the Recovery Act of 2009 were delayed by lack of guidance on how to satisfy the “Buy America” and prevailing wage requirements, reporting burdens on local governments, and the need for significant administrative capacity for managing projects. 
  • Infrastructure stimulus in 2021 needs clear federal spending guidance, interagency coordination, streamlined program requirements, and a longer time horizon than three years to effectively allocate funds
  • Equity and environmental justice must be focused, for example through workforce programs for communities transitioning away from fossil fuel employment, and assistance for solar panel installation, home weatherization, and EV infrastructure for low-income, rural, and underrepresented groups.
  • The next green stimulus should provide support and resources to locations with less experience and administrative capacity, and to sectors that may not have readily available American-made products.

Supporting and expanding the nation’s infrastructure is of the utmost importance. Investments in roads and bridges, water systems, broadband, and transmission and distribution lines help improve well-being and personal lifestyles. Such investments also generate new jobs and economic growth, and can lead to long-term reductions in climate emissions if designed well. These objectives are the impetus for current infrastructure planning in Congress and the several trillion-dollar American Jobs Plan released by the Biden administration.

The American Recovery and Reinvestment Act of 2009 (the “Recovery Act”), adopted a month into President Obama’s first term and during the worst economic recession in modern history, shares similarities with recent infrastructure planning. As Congress contemplates the contents of such a bill, and as agencies construct an implementation plan, there are valuable insights to glean from the rollout of the Recovery Act. There are also important market and political differences between 2009 and 2021 that beget new opportunities and challenges for current infrastructure spending.  

In this report, I provide an overview of Recovery Act implementation challenges, which should inform current infrastructure spending. I then discuss some differences between 2009 and 2021 in the markets and conditions surrounding infrastructure spending, and the implications for the current environment.

Read the full brief here.

Photo by Mudassir Ali from Pexels