Week of October 23, 2023
House Subcommittee Addresses Impending Highway Trust Fund Issues
Although the Infrastructure Investment and Jobs Act (IIJA) is not due to expire for several more years, there are already emerging concerns about the potential financial instability of the Highway Trust Fund.
The Highways and Transit subcommittee is considering several options to supplement the trust fund, such as implementing user fees based on mileage and imposing federal charges on electric vehicles.
A group of 24 organizations has suggested a long-term solution for the Trust Fund that maintains the principle of user-based financing.
According to the Congressional Budget Office (CBO), raising gasoline and diesel taxes by 15¢ per gallon could generate an annual revenue of approximately $25 billion.
These developments could influence future infrastructure projects and funding, as changes in funding mechanisms could impact project budgets and timelines.
Consumer Expenditure Drives U.S. Economy to a 4.9% Summer Growth Rate
The U.S. economy saw a significant growth spurt over the summer, with a 4.9% increase in GDP in the third quarter, marking the fastest rate since late 2021.
Despite the Federal Reserve’s interest-rate hikes aimed at slowing the economy to control inflation, consumer spending increased, contributing to this growth.
However, the economy may face a slowdown due to various factors such as higher long-term interest rates, potential government shutdowns, wars in Ukraine and the Middle East, and prolonged labor strikes.
Residential investment increased by 3.9% in the third quarter, but rising mortgage rates could impact this sector. Similarly, higher interest rates could affect credit card usage and other forms of borrowing, potentially leading consumers to reduce spending.
While there are hopes for a soft landing where inflation slows without causing a recession, forecasters predict that economic hurdles could lead to a slowdown. This is particularly relevant as consumer spending accounts for most of U.S. economic output.
October 23, 2023
Oaktree Capital Management, L.P. (Oaktree), a California-based global asset management firm specializing in alternative investment strategies, has made a strategic investment in Aecon Utilities Group, Inc. (Aecon), a Canada-based provider of utility infrastructure solutions operating in the electrical transmission and distribution, renewables and in-home services, telecommunications, and pipeline distribution end markets. The investment accelerates Aecon’s growth strategy of delivering infrastructure solutions under more collaborative models linked to decarbonization, sustainability, and the energy transition. Andrew Moir, a Senior Vice President in Oaktree’s Power Opportunities Group, commented on the investment, “Aecon Utilities is widely known as the leading provider of mission-critical recurring utility infrastructure services across Canada. We see tremendous opportunity to leverage its capabilities to expand with new and existing customers while maintaining the commitment to workforce safety and exceptional quality for which Aecon Utilities is known.”
October 25, 2023
RMA Group, Inc. (RMA), a California-based geotechnical engineering and consulting services firm backed by OceanSound Partners, has acquired Big Apple Group (Big Apple), a New York-based testing and inspection services firm providing geotechnical investigations, construction materials testing, special inspections, and monitoring services throughout the eastern United States. The transaction expands RMA’s service offerings to include monitoring, optical scanning, and remote sensing capabilities and supports geographic expansion in key markets. Joe Lowy, founder of Big Apple, said of the transaction, “Big Apple has built a strong reputation for providing the highest quality inspection and monitoring services in the Tri-State Area. Joining RMA allows us to better serve our clients by offering a broader portfolio of services and access to greater corporate resources.”
October 26, 2023
TowerBrook Capital Partners (TowerBrook), New York-based private equity firm specializing in add-on acquisitions, direct, and fund-of-fund investments, has made a minority investment in Langan Engineering & Environmental Services (Langan), a New Jersey-based provider of integrated land development engineering and environmental consulting services. The partnership supports Langan’s strategic vision through the addition of TowerBrook’s financial and business operations expertise and resources. David Gockel, President and CEO of Langan, commented on the investment, “Over the years, many investors have expressed great interest in Langan, and we have evaluated multiple options during this process. We found TowerBrook’s reputation and resources best suited to help Langan achieve our strategic goals.”
October 26, 2023
Accenture plc (Accenture), an Ireland-based strategy and consulting services firm, has acquired Comtech Group (Comtech), a Toronto-based consulting and program management company for infrastructure projects in Canada and the United States. The transaction follows Accenture’s recent acquisition of Anser Advisory and expands Accenture’s capital projects capabilities in Canada by bringing in Comtech’s team of consulting and project management experts in construction management, facility and manufacturing engineering, and process control automation. Aaron Saint, North American lead for Industry X at Accenture, said, “With Comtech Group, we will help our clients deliver mission-critical infrastructure projects on time and on budget…by combining Accenture and Comtech Group capabilities, we can better help deliver on our clients’ ambitious infrastructure programs.”
EFCG is thrilled to announce the addition of six new members to our distinguished team! Trevor Casey (Senior Vice President), Emily Shaw (Vice President), and Alexis Borg (Analyst) will be joining EFCG's M&A team. Ryan Del Grosso (Associate), Addy Orcutt (Analyst), and Ethan McCue (Analyst) will join our talented Advisory team.
Please join us in warmly welcoming our new EFCG team members as we continue our journey toward providing a data-driven and strategic edge to Architecture, Engineering, and Consulting (AEC) firms to advance the innovation, sustainability, and success of the industry!