As the year ends, small business owners once again develop plans for their businesses. The process can be time-consuming and mind-numbing, which is often a source of stress among business owners. This time, however, it’s different.
There is excitement about the expected impact of the new Infrastructure Investment and Jobs Act has on small businesses. In fact, according to the Small Business Administration (SBA), small business owners and advocates are celebrating the passage of the bill. As they recover from business losses and labor constraints caused by the pandemic, the new law offers hope of growth and expansion.
The Infrastructure Package in Summary
On November 15, 2021, the 2,700-plus page Infrastructure Investment and Jobs Act (IIJA) officially became law. It is part of President Joe Biden’s American Jobs Plan introduced in March 2021. The new $1.2 trillion infrastructure law has two main objectives:
First, it rebuilds the country’s outdated infrastructure and transportation programs.
Second, it includes $550 billion in new federal spending that will focus on revitalizing and improving all modes of transportation, public transit, clean energy infrastructures, and even broadband and cybersecurity.
The IIJA is truly a game-changer for small businesses. But, how exactly will the new law benefit small businesses? This article aims to explain what provisions are included in the new law briefly. These provisions are expected to provide a lift for small businesses to help them grow and expand further.
Building and Rehabilitation of Roads and Bridges
An estimated 20% of the country’s highways and major roads and 45,000 bridges are outdated, often in poor condition. According to legal intelligence expert JD Supra, the IIJA will invest $110 billion in building and rehabilitating roads, highways, and bridges. This provision also includes funding for transportation safety and the construction of community infrastructure.
According to the SBA, the provision will create opportunities for small businesses to bid for infra projects at local and community levels. This will increase funding for the improvement of urban planning, which will encourage the creation of more parks and community recreation facilities.
When there are proper community facilities, it will open up new opportunities for business. For example, a sports medicine physician can open up a clinic near a community center. Other small businesses and establishments, popular in community areas, will also start to sprout up one by one.
The IIJA will invest $65 billion in upgrading the country’s broadband infrastructure. It will help lower-income households to get an affordable internet connection. This provides an opportunity for small businesses to reach a market that couldn’t connect to the internet before.
The provision will also encourage more small businesses to transform digitally. The SBA believes this will help companies recover from their losses due to the pandemic.
Improve Power and Water Systems
The IIJA is set to invest $50 billion and $55 billion to improve the nation’s power and water infrastructures, respectively. An additional $50 billion will be invested in strengthening the country’s power and water systems to protect it against floods, droughts, and even cyberattacks.
The provision will rebuild the electric grid, expanding the nation’s renewable energy programs. It will also upgrade the country’s water infrastructure, replacing lines and pipes to enable communities to access clean water.
Modernize Public Transit and Rail
The IIJA will also invest $39 billion to meet the demand for public commuting. Public transit, including rail and bus fleets, will be modernized, repaired, and replaced.
One of the most exciting objectives of this provision is to build an intercity rail service to provide better public transportation. Small businesses see this as an opportunity to tap into a labor force that often can’t get into cities because of transpiration problems. In fact, the SBA believes this provision will attract more potential workers.
The provision will also improve the nation’s freight rail system and open up regions that weren’t previously reached by railway. For businesses, this means the shipment of products and raw materials will be improved.
Repair Airports and Ports
The IIJA also aims to repair and maintain the nation’s port infrastructure and airports. This will help in the electrification of ports and airports, which targets lower carbon emissions through these modes of transportation.
But Businesses Need to Practice Patience
The IIJA, however, isn’t a stimulus effort. It’s not a solution for an economic crisis or pandemic response. This means that IIJA projects and programs will not be immediately seen or felt. Most of them aim completion over five to ten years.
Still, all the provisions in the IIJA are rays of hope for small businesses. Smaller projects may even be expected to start at the end of 2022. For now, though, small businesses can make better plans for long-term success because of the IIJA.