What Does This New Executive Order Mean for the Construction Industry?


Shoring up the country’s lagging infrastructure was a major issue on then president-elect Trump’s campaign platform. Though details on its exact execution have not been fully released, President Trump signed an executive order on August 15, 2017 whose purpose is to streamline the federal approval and permitting process for new infrastructure projects. These projects are limited to those deemed as being major and seek to reduce the entire timeline of permitting and approval at the federal level to about two years.

One aspect of the President’s order is the cessation of the Federal Flood Risk Management Standard. This standard pertained to projects that are subjected to federal funds and that could be adversely affected by rising sea levels. Officials at the state and local levels can still adopt this, as well as other, standards in existence if they choose to do so, according to Reuters.

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Executive Order Sets Tone for Infrastructure Investment

This executive order is expected to be the first step in a process that could domino from the federal level to include investments at the private level. The 2018 budget includes a call for direct federal spending in the amount of $200 billion. This is, in turn, expected to generate additional funding from the private sector for $1 trillion in total.

Uncertainty in Project Scope

The Trump administration has compiled a list of national projects that have been classified as important. The recent overhaul of the Fostering Advancements in Shipping and Transportation (FASTLANE) to one that focuses on transportation grant programs that benefit rural projects and infrastructure as well as those projects that rely on nonfederal and private investment, resulted in the program now known as the Infrastructure for Rebuilding America (INFRA). These two occurrences – when taken together – indicate that this administration intends to prioritize these types of projects during his program to rebuild the nation’s infrastructure. However, there may be some resistance from both political parties along the way. Some dislike the use of private funds on huge public works programs such as the one he is proposing. On the other hand, some may be opposed to any type of funding that has a stimulus feel to it.  It remains to be seen if this could affect home builders and those who finance the construction of such projects.

Presidential Task Force Formed

In order to oversee his expansive infrastructure plan, President Trump formed a task force to oversee its development. Two New York City developers, Steven Roth and Richard LeFrak, have extensive careers in the industry and are charged with supervising an expert group of engineers and builders that numbers between 15 and 20. The duo’s primary goal will be to assess spending as the national infrastructure plan is implemented across the country.

It’s certainly difficult to predict the exact impact these changes may bring, but it’s hard to imagine that a new focus on infrastructure won’t alter some investors’ plans as more projects are put into motion.

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