Federal bill continues support for transportation programs

By Alex Beckmann

The new federal “omnibus” appropriation bill, enacted March 23, provides over $86 billion for the U.S. Department of Transportation, a record funding amount and an increase of almost $10 billion from U.S. DOT’s FY ‘17 funding levels. Road, transit, and rail programs all see funding increases, including long-standing popular programs like the Transportation Investments Generating Economic Recovery (TIGER), Transit Capital Investment Grants program (CIG), Amtrak, and even the highway formula trust program. This funding is likely to stand in for the more robust infrastructure package proposed by the Administration, which is unlikely to pass Congress this year.

The large funding increases are notable because they show a clear rejection by Congress of President Trump’s proposed budget for U.S. DOT, which proposed eliminating many of the programs that received a record amount of money, including TIGER, the CIG program and Amtrak’s long distance train service. Additionally, it shows that Congress still believes that the federal government should play a large role in funding state and local infrastructure, and not just rely on state, local, and private money for investment.

Below are some specific details about relevant U.S. DOT programs.

The law fully funds the FAST Act-authorized amount for Federal-aid highway and highway-safety construction program under the highway trust fund in FY 18 by providing $44.234 billion in obligation authority. There is also no new highway contract rescission in the law. However, this law does nothing to address the upcoming shortfall in 2020 in the highway trust fund, which could lead to large spending cuts funding unless Congress acts.

In addition, there is a one-time appropriation of $2.5 billion for additional highway infrastructure through existing trust fund formula programs. Of this additional $2.5 billion, $1.98 billion is set aside for highway and bridge projects using the Surface Transportation Block Grant Program formula. The bill eliminates the Surface Transportation Program set-aside for this additional funding; therefore, the additional $1.98 billion must be spent on highway-related infrastructure. Another $225 million of the additional formula funding is reserved for a competitive highway bridge program for states that have a population density of less than 100 individuals per square mile. We estimate that 24 states will be eligible for this program. The legislation requires applicants to demonstrate cost savings by bundling multiple highway bridge projects. However, beyond that requirement, the legislation does not provide specific criteria for how projects should be chosen.

The law allows states to repurpose any Congressional earmark that is older than 10 years and administered by FHWA. The states may use these earmarks for any activity that is eligible under the Surface Transportation Block Grant Program. States have to notify U.S. DOT of their intent to repurpose the earmark and then have three years to obligate the funds.

The law triples funding for the TIGER program, providing $1.5 billion. The TIGER program is a flexible, competitive grant program that has been used by state DOTs and other transportation departments to fund infrastructure improvements across many modes, including highways, bridges, ports, passenger and freight rail, transit, and bicycle/pedestrian. Of the $1.5 billion, $15 million is set aside for planning grants. TIGER awards range from $5 million ($1 million in rural areas) to $25 million. Rural projects are required to make up 30 percent of awards. The law allows the federal government to provide up to 80 percent of a project’s cost in urban areas and 100 percent of a project’s cost in rural areas. U.S. DOT is required to issue a Notice of Funding Opportunity within 60 days after the law is enacted and to make awards within 270 days after the law is enacted.

Finally, the law provides $2.6 billion for the CIG program, a 10 percent increase compared to the FY 17-enacted level. The New Starts part of CIG receives $1.5 billion, a decrease from the $1.7 billion provided in FY 17. Core Capacity receives $716 million, an increase from $331 million in FY17, and small starts receives $401 million, a decrease from $407 million in FY17.

Many of the funding levels mentioned for the programs above are record amounts. The FY 18 funding levels show Congress’s commitment to robust federal investment for important state and local infrastructure projects.

Alex Beckmann is a Program Associate at Smart Growth America.