First, in relation to the $50 billion proposed investment in transportation infrastructure, much of the transportation infrastructure spending in the United States is subject to longstanding, pre-existing Buy American restrictions. So there was legislation back in 1982 that essentially imposed a Buy American condition on federal transfers to states for transportation projects. There are some minor exceptions to that, but basically much of this $50 billion will go through pre-existing programs under which there have been longstanding restrictions on all foreign suppliers, including Canada. So these are not new restrictions.
Second, for many construction projects, residential as well as non-residential, a significant portion of the overall project cost goes into non-tradeable inputs: things like labour costs, taxes, demolition costs, permitting, and contractor profit. Based on our preliminary analysis, about 50% of the infrastructure spending is actually on these inputs, which are not internationally tradeable, so Canada would not have access to those particular inputs.
Third, there is a program, a neighbourhood stabilization initiative, and if prior experience is any indication, approximately 25% of the spending goes to the actual acquisition of the foreclosed or abandoned home. When you take that into consideration along with labour costs, demolition, taxes, and profit, then really about 30% of that remaining $15 billion is left over to purchase construction materials.
When you look at all of the elements that are non-tradeable internationally, the figure of $100 billion is reduced very significantly.
We also have to look at the extent to which Canadian suppliers participate in those markets throughout the United States. Our suppliers are much more active in certain markets than in others. And at this time it would simply be premature to try to determine where the money is going to be allocated if this bill is adopted, in which states it's going to be allocated, and whether or not Canadian firms are actually active and competitive in those regional markets.