White House adviser discusses federal infrastructure help for La; efforts to tame inflation

Rising costs for supplies and higher interest rates could impact some projects
Published: Jul. 29, 2022 at 7:33 PM CDT
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NEW ORLEANS (WVUE) - Federal infrastructure dollars have already flowed to Louisiana and the state is expected to receive more, according to a White House Infrastructure advisor.

Ryan Berni, a Louisianan, who is now part of the Biden administration’s infrastructure team said the money doled out to the state was not a one-and-done type allocation.

“Over $2 billion has already been announced and allocated to the state of Louisiana and they’re going to be billions more that come to the state really over the next five to seven years,” said Berni.

The source of the funding is the $1 trillion infrastructure package President Biden got through Congress. Berni spoke one-on-one with FOX 8 about that and more.

“President Biden’s bipartisan infrastructure law includes over $20 billion dollars to strengthen and harden the grid, not only to make it more resilient to things like extreme heat and weather volatility but also to make sure that we are preparing for all of the new electricity that’s going to be needed as we move to electric vehicles,” said Berni.

Hurricane Ida wreaked havoc on Entergy’s power lines in 2021. And Entergy is hoping to get federal help.

“Local governments, state governments depending on the place, what part of the country you’re in, as well as corporations, will be able to apply for funding to strengthen the grid and those programs will be rolling out in the coming months.”

President Biden toured the water plant in New Orleans last year.

“One of the major parts of the infrastructure law is over $60 billion for water and sewer programs across the country,” Berni stated.

Biden’s infrastructure package has money to reduce lead pipes.

“One of the big priorities the president has with the infrastructure law is to make sure that we reduce lead pipes because we know that, that is poisoning our kids, and no level is safe in drinking. So, there’s a $15 billion amount dedicated specifically to address that issue,” said Berni.

But inflation could hamper some projects. FOX 8 asked Berni if the Biden administration is concerned higher interest rates could have a negative impact on local and state governments who want to do more capital improvement projects.

“Look, the reality with inflation is that things are costing more and so we’re looking to address them by fixing supply chains, bringing back domestic manufacturing so that we can lower costs for projects like infrastructure rebuilding,” said Berni.

A spokesperson for the city of New Orleans said:

“The interest rates will impact the borrowing power of both our large and small businesses. Most vendors finance the City’s contracts with Bank Lines of Credit. Those rates are not locked in and can be variable with market rates. Additionally, those vendors also borrow or finance from OEMs and suppliers for materials and supplies used in construction of our projects. All these aforementioned issues impact our response to bids for our solicitations that are coming in 100-300 percent over our estimated budgets. This goes well above our federal grants and digs deep into our bond funds which reduces further projects we can provide to residents.”

Jim Spiro is a managing director with Morgan Stanley. “Obviously one of the biggest considerations is the borrowance rate, the cost of the money,” said Spiro.

When money is more expensive to borrow it takes more money to repay it.

“It may cause the repayment of the bonds to be more difficult and it may put more pressure on a variety of entities according or it might be more pressure on taxpayers to pay the money back,” said Spiro.

A spokesperson for Entergy sent an email in response to questions from FOX 8 and stated that the company has not received any federal funds yet, however, it applied for:

· A BRIC (Building Resilient Infrastructure & Communities) application for upgrades to the Derbigny Substation.

· We have partnered with LSU, MS State, Posigen, and Together New Orleans on a Dept. of Energy RACER grant for a proposed project entitled “Smart Equitable Energy Resilience (SEER): An Automated Coordinated Approach for Energy Resilience and Restoration in Disadvantaged Communities using Solar PV.”

The spokesperson’s statement also said:

“We have not applied for grant funding under the IIJA (Infrastructure Investment & Jobs Act) program because the notice of funding opportunities that apply to us and/or the City or State have not been issued by the federal government yet. However, we anticipate that approximately $13 billion of funding opportunities will be available toward the end of this year or early next year. We also continue to meet with the Federal Delegation seeking money for Hurricane Ida Storm Recovery Costs under the Community Development Block Grant Program. And, as we have advised the Council, we will be very aggressive in seeking all funding available to us in an effort to offset costs to our customers.”

Berni said the administration is working hard to tame inflation and bring done costs for Americans.

“One of the things folks in Louisiana would understand is, you know, gas is down, under $4 a gallon in Louisiana and that’s driven in large part because of the president’s actions to increase the flow of oil through the Strategic Petroleum Preserve which is housed right there in south Louisiana,” he said.

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