“This funding will transform Connecticut, if we do it right,” Department of Revenue Services Commissioner Mark Boughton said of the $5.4 billion Connecticut is receiving through the federal income tax law. investment and employment in infrastructure.
Boughton, appointed by Gov. Ned Lamont to oversee how the state spends those funds, led a discussion on funding priorities with business leaders at the CFIA’s Connecticut Economic Update Conference. April 21.
Pat Munger Construction Company President David DeMaio, UPS Vice President of Government Affairs Tom Jensen and Santa Energy Corporation President Tom Santa shared a range of views with Boughton and an audience of 200 chefs of business.
Boughton explained that the funding includes a dedicated $5.4 billion over five years and additional grants that states will compete for that he says will require quick action.
“If you’re not first, you’re last,” Boughton said. “You need to get these apps as soon as possible.
“There’s a long list of very competitive grants from other states, other counties, other cities and towns across America, and we want our fair share.
“That’s really where I think Connecticut can excel. Connecticut is uniquely positioned to tap into that money. »
Boughton then asked panelists what the government needs to do to ensure the infrastructure bill is transformative.
DeMaio, who sits on the AABC’s board of directors, described road construction as “low hanging fruit”, but acknowledged that adding new lanes to the road was nearly impossible given the effort and logistics.
Instead, he argued for strengthening freight rails.
“The infrastructure is there and it’s dated,” DeMaio explained. “But it needs to be updated to reduce heavy truck traffic on our highways.”
DeMaio also called for a focus on “last mile” facilities, a reference to the final stage of the delivery process.
“For us, putting 40 trucks on the road with crews and having to fight traffic on those highways, if we could get that freight off the highways and railroads to convenient transportation locations, I think that would be a game changer. generational,” he said.
Santa Claus accepted.
“We really need to rethink how freight moves across and within the state,” he said.
“We have underinvested in rail and deep sea ports for a long time. They are dormant assets that really need to be brought back to life, invigorated and to create opportunities and jobs. »
Santa Claus pointed out that there is a “radical change in transport” as remote working becomes the norm and businesses start to return to normal.
“But our supply chain infrastructure is stretched beyond capacity,” he said.
“So we need to cross-modally rethink how we approach and solve the problem.”
“Focus on what matters most,” Jensen said, “like your major freight and mobility pinch points,” such as Interstates 95, 91 and 84.
“It’s about increasing fluidity and speed to move people and goods. Fixing potholes is fine, but if you’re not trying to figure out capacity, you’re planning to to fail.
“Everything is ordered online and that’s not going away, and we’re going to need more trucks whether you like it or not.”
Boughton addressed the same issue from a private sector perspective, asking what companies can do to transform the bill.
Santa Claus said the first step was to make sure all constituencies were in agreement on goals and objectives.
“Everyone comes to the party with their idea of the problem and how to fix it,” he said. “The key to solving a problem is to identify it.
“We need to step back and look at the bigger picture, and figure out what are the things we can do that will cost the least to get us the best out of it.”
Jensen, who is UPS’s chief transportation advocate in Washington, DC, took the approach that just because the bill passed doesn’t mean everything will be free for the business community.
“We have to keep paying for what we invest in,” he said. “It’s user-pay and user-benefit.”
‘Embrace the change‘
He argued that temporarily suspending the gas tax in Connecticut was the wrong approach to improving the economy and instead implementing policies that directly target inflation.
“We need to be partners in this,” he said. “There is no free transport and infrastructure.
“We must be prepared to pay our fair share if the money goes where it is directed and deserved.”
DeMaio said that if the bill were to succeed, companies had to “embrace change.”
“Obviously there is going to be change,” he said. “Let’s say, for example, there’s a big initiative to improve public transport – to make it efficient, to make it clean, to make it on time.”
DeMaio said his company encourages employees to switch to public transportation, like an annuity fund that feeds into a college fund for their children.
“Now you are creating generational wealth within the family,” he said. “I know it’s off the beaten path, but isn’t that what we’re supposed to do?”
Asked about specific programs, DeMaio said he was looking for an easier way to obtain a commercial driver’s license for his employees.
“We have loads of freight, steel and lumber lying around in factories and elsewhere in the country that we cannot transport,” he said.
When he sought CDLs for his employees, DeMaio said it was about a month of training his company would have to cover at a cost of about $6,000 for each license.
“How can we work together to solve this problem? ” He asked. “I’m willing to pay my fair share, but how do I make it more convenient? »
Boughton acknowledged how expensive and difficult it can be for a business just getting started and alluded to a program he is working on with the governor.
“I spoke to the governor about it, and we may have some help for you,” he said. “I’m working on something.
“Jensen zoomed out and talked about prioritizing ‘projects of regional and national significance.’
He targeted the programs lawmakers push for political reasons and instead focused on projects that will do the most good for the most people.
“At the end of the day, that’s what the transportation system is,” he said.
“It should be seen as a holistic economic driver and job creator.”
Santa Claus said it was difficult to follow specific programs because there is so much going on at the government level.
Boughton told him that the state government is making outreach efforts to guide businesses through programs that include searchable materials, quarterly calls and facility tours.
“We want to hear from you,” he said, “and we’ll come meet you at your business to understand the challenges you’re having.”
On the supply chain, DeMaio said he needed more support from the government.
“It’s become such a regulatory burden to bring steel mills online,” he said.
“Until we can bring the raw material facilities online here and have the infrastructure to support them, the critical point is that we can’t manufacture the product here.”
Jensen agrees, but is not convinced that the infrastructure bill is the way to reform the supply chain.
“It’s a completely natural and organic process,” he said.
“It’s going to change and self-correct, and it’s going to take a long time to self-correct, and it’s going to be painful in the meantime.
“The government’s role in making this happen, I’m not sure the infrastructure bill is going to fix the supply chain.”
As for change, “being in the energy business is a bit like being in the eye of the hurricane,” Santa said.
“And the supply chain is at the heart of many of our issues.”
While Santa knows the country is moving away from an oil-based economy, the process will take decades.
“We can’t stop investing in oil infrastructure now because we won’t reach the brave new world we’re going to,” he said.
“We are a very energy-intensive society and we have to work on it.
“Solving some of our transportation issues will start that process, but it won’t be easy and it won’t be cheap.”
Boughton closed the panel by asking panelists what it would look like if the bill failed.
DeMaio said failure to use all the funds would be a “catastrophic event” for the state.
“We have so many challenges, and if we don’t make those changes, it’s a big missed opportunity,” he said.
“It’s not just about making legislative changes or investments. It compels every Connecticut business owner to embrace and support this change.
“It has to be a holistic approach for business owners to really embrace it.”
“Failure would be the status quo,” Jensen said.
“We know what it looks like today. Take a picture, and if we have the same conversation six years from now, it’s a fail.
“It’s easy to spend money,” Santa Claus said, “but we have to enjoy it.
“We need to make sure the benefits are real, tangible and will improve the state. Otherwise, the money will be gone and nothing will have changed.