Senate GOP unveils its $928 billion infrastructure counteroffer to Biden — here’s what’s in it

1. Senate Republicans unveiled a $928 billion infrastructure counteroffer to President Joe Biden on Thursday.

2. Sen. Shelley Moore Capito said she was “optimistic” about infrastructure talks with Biden but still sees a “big gap” between Republican and White House plans.

3. The White House has said it hopes to see progress in bipartisan talks by Memorial Day.

Senate Republicans unveiled their $928 billion infrastructure counteroffer to President Joe Biden on Thursday, as the sides see whether they can bridge an ideological gulf to strike a bipartisan deal.

The plan includes:

1. $506 billion for roads, bridges and major infrastructure projects, including $4 billion for electric vehicles

2. $98 billion for public transit

3. $72 billion for water systems

4. $65 billion for broadband

5. $56 billion for airports

6. $46 billion for passenger and freight rail systems

7. $22 billion for ports and waterways

8. $22 billion for water storage

9. $21 billion for safety efforts

10. $20 billion for infrastructure financing

Biden’s latest offer to Republicans came in at $1.7 trillion — $600 billion less than his original plan. He has urged the GOP to put at least $1 trillion into an infrastructure package.

The White House did not immediately respond to a request to comment on the senators’ offer.

Republicans and the White House have moved closer to agreement on an infrastructure plan but still need to resolve fundamental issues about the scope of a package and how to pay for it, a GOP senator leading the effort said Thursday. Sen. Shelley Moore Capito said the sides are “inching closer” in negotiations ahead of Memorial Day, the date by which the White House wanted to see progress in bipartisan talks.

“We’re still talking. I’m optimistic, we still have a big gap,” Capito told CNBC’s “Squawk Box.” “I think where we’re really falling short is we can’t seem to get the White House to agree on a definition or a scope of infrastructure that matches where we think it is, and that’s physical, core infrastructure.”

“The White House is still bringing their human infrastructure into this package and that’s just a nonstarter for us,” she continued, referencing Biden’s plans to put money into programs including care for elderly and disabled Americans.

It is unclear if the two parties can overcome broad ideological differences over what constitutes infrastructure, and how to pay for improvements to it, to strike a bipartisan deal. If negotiations do not show promise, Democrats will have to decide whether to try to pass an infrastructure bill on their own using special budget rules.

The process would bring its own headaches, as Senate Democrats would have to both keep all 50 members of their caucus on board and comply with strict rules about what can go into a budget reconciliation bill.

Republicans have said they do not want to raise taxes to cover the costs of improving transportation, broadband and water systems. Biden has called to hike the corporate tax rate from 21% — the level set by the GOP after it cut taxes in 2017 — to at least 25%.

“We can do this without touching … those tax cuts,” Capito told CNBC.

She mentioned that lawmakers could redirect unused coronavirus relief funds to state and local governments to infrastructure, or implement user fees on transportation like electric vehicles. Those Republican solutions could put Biden in a bind.

The president has promised not to raise taxes on anyone who makes less than $400,000 per year. User fees or an increase to the gas tax would put an extra burden on many Americans whose incomes falls under the threshold.

Capito said she sees the potential for bipartisan agreement on transportation spending. She noted that the Senate’s Environment and Public Works Committee — where she sits as ranking member — advanced a roughly $300 billion surface transportation bill that she thinks could guide a broader infrastructure deal.

In trimming his original $2.3 trillion plan, Biden cut out funding for research and development and supply chain enhancements. He also reduced proposed spending on broadband, roads and bridges.

Biden did not cut down the proposed $400 billion for home-based health care. Republicans have criticized that spending as part of an infrastructure package.

This post is published on cnbc.com. Our only aim is to share it with wide audience