January 24, 2022
IIJA Implementation Update
Two months have passed since President Biden signed the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA). Implementation has been rapid, especially for existing programs receiving a funding boost. On January 14, President Biden addressed IIJA implementation and announced $27.5 billion for smaller (“off-system”) bridge replacement projects and a waiver of the cost share requirement. On the same day, the administration issued a progress report: “Biden-Harris Administration Hits the Ground Running 60 Days into Infrastructure Implementation.”
The report includes funding highlights and dozens of links to departmental lists, press releases, and Federal Register notices. FBIQ dove in and identified key program implementation information, including deadlines, guidance documents, and opportunities for engagement.
When we get this done, we will get back to beating the world again…once again being #1 in the world, instead of where we sit now at #13, in terms of the quality of our infrastructure.
IIJA Scope and Timing: IIJA funding for FY22-26 is estimated to be $840 billion. Nearly two-thirds, about $567 billion, is for transportation programs. Energy, natural resources, and commerce programs (specifically broadband) are each about 8% of the total, between $65-68 billion. The Congressional Budget Office predicts that federal IIJA spending will peak between FY25 and FY27. Keep in mind, that is the timing for federal outlays to states, localities, and grant recipients—so payments from those entities to their vendors or subs will lag.
IIJA created many new programs—more than a dozen for highways alone—and most are for competitive grants. Administrative set up and rulemaking requirements will delay expenditures from these new programs. However, there are multiple opportunities for stakeholders to provide input and get information about administration priorities and key evaluation criteria.
In a December 16 memo, the Federal Highway Administration (FHWA) set out the priorities for IIJA highway funding. “Policy on Using Bipartisan Infrastructure Law Resources to Build a Better America” lists eight focus areas for new and existing programs, including “prioritize infrastructure that is less vulnerable and more resistant to a changing climate” and “future proof our transportation infrastructure by accommodating new and emerging technologies.”
On December 1, FHWA published a Request for Information (RFI) asking for input on the FHWA-related IIJA provisions. This is general, overarching RFI solicits public and stakeholder feedback on implementation. There is no comment deadline, but timeliness matters as FHWA develops guidance.
The largest single IIJA funding flow is highway money to states. On December 15, FHWA announced that it would make $52.5 billion in FY22 formula funding available to states through the federal aid highway program, an increase of more than 20% above the FY21 level. See state-by-state fact sheets with funding information covering all IIJA Transportation programs. Between FY22 and FY26, IIJA will provide over $350 billion for highways, which includes $270 billion for the federal-aid highway program and $80 billion for a broad variety of programs including bridges, electric vehicles, pilot programs, and research.
TRANSPORTATION: RAISE DISCRETIONARY GRANTS
On November 19, Transportation Secretary Buttigieg announced the first set of RAISE grants (Rebuilding American Infrastructure with Sustainability and Equity) totaling $1 billion. On December 13, he followed up with additional awards. RAISE, which receives $7.5 billion in IIJA, is a rebranding and expansion of an existing capital grant program designed to address large, multi-state, or regional highway projects.
Tech is a point of emphasis in RAISE grants. For example, the New Mexico Department of Transportation will receive $25 million for U.S. 64 reconstruction, including fiber optic cable installation to connect communications and improve data and traffic management. Seattle will receive $20 million to help reduce supply chain bottlenecks and add smart control systems using “Split Cycle Offset Optimization Technique” technology.
TRANSPORTATION/ENERGY: ELECTRIC VEHICLE (EV) CHARGING
The Departments of Transportation and Energy will jointly manage EV charging. Significant activities include: 1) the EV Charging Action Plan, which is the basis for $7.5 billion in funding decisions; 2) a Transportation-Energy joint office to guide the national charging plan; 3) stakeholder input through an RFI; and 4) an RFI on U.S. sourcing/Buy American of electric vehicle chargers and components. The administration has promised to publish guidance for states and cities regarding the charging network by February 11.
On December 13, the administration released the Electric Vehicle Charging Action Plan. IIJA includes $7.5 billion for a national charging network. The first $5 billion is for state formula funding, with a 10% set-aside for grants from the Secretary. In addition, $2.5 billion is for competitive grants to support administration priorities in rural areas and disadvantaged communities.
A Joint Office of Energy and Transportation was established December 14 by a Memorandum of Understanding. The goal is to use resources of both departments, including the National Labs, to support guidance development and technical assistance for EV charging infrastructure and other electrification and to provide a coordinated approach and central point of contact.
On November 28, the FHWA published a Request for Information to solicit input on EV Charging Program guidelines, with comments due January 28. Guidance for the program will follow. Statutory guidelines include evaluation of “connections to the electric grid, including electric distribution upgrades; vehicle-to-grid integration, including smart charge management or other protocols that can minimize impacts to the grid; alignment with electric distribution interconnection processes, and plans for the use of renewable energy sources to power charging and energy storage.”
The RFI regarding Buy American for EV charging equipment is intended to maximize domestic sourcing and labor for both current and future equipment and maintenance needs. The comment period closed January 10.
On December 16, FAA announced the first $2.89 billion in airport infrastructure awards from the $15 billion airport infrastructure fund. The awards went to 3,075 airports and can be used for traditional infrastructure, such as runways and roadway projects; to enhance capacity, security or address environmental issues; and for resilience and energy-efficiency focused projects. Planning, survey, and design and other professional services that are needed for projects may be eligible for the funds. FAA provides information on eligible projects (including weather observation stations and electric charging for ground vehicles) and a full list of airports receiving funds. FAA has not made any announcements regarding the $5 billion airport terminal program.
On December 23, Secretary Buttigieg announced $241 million in FY21 Maritime Administration Port Infrastructure Development Program (PIDP) grants for 25 port facility projects. IIJA makes $2.25 billion available from FY22 through FY26, or $450 million annually.
The Department reports that the FY22 Notice of Funding Opportunity (NOFO) will be released mid-February. PIDP grant priorities include job creation, climate change, and environmental justice. FBIQ expects these priorities to be reflected in the FY22 NOFO. Nineteen states and one territory received FY21 grants covering coastal, lake, and inland river ports. Projects include $5.2 million for Oakland, CA, to replace an electrical substation and circuit, build a new on-site fuel cell facility and a solar array with battery storage, and connect the port’s substation and the local electric utility’s biomass-fuel generator. The Portsmouth, VA, Marine Terminal received $20 million to create wind turbine generator staging and storage.
CORPS OF ENGINEERS: PORTS AND WATERWAYS
On January 19, the Corps announced $5 billion in IIJA funding to improve community resilience projects, including repair of damage from floods and mitigating climate-related threats, and $4 billion for commercial navigation improvements at ports and inland waterways.
On January 11, the Department of Energy (DOE) released a notice of intent for a “Building a Better Grid” initiative to upgrade and expand the electric grid, with the goals of resilience, reliability, and decarbonization. IIJA funds will accelerate the deployment of new transmission lines.
The notice of intent addresses significant new programs: 1) a $2.5 billion revolving fund to facilitate the construction of high capacity new, replacement, or upgraded transmission lines; 2) $5 billion for grants to harden power lines against extreme weather, wildfires, and natural disasters ($2.5 billion in formula grants and $2.5 billion in matching grants for industry); 3) $5 billion for electric grid reliability and resiliency (competitive grants for states and localities); and 4) $3 billion for advanced grid technologies (matching grants for industry).
Implementation guidance will be forthcoming from DOE. To support the transmission lines program, DOE will conduct a National Transmission Needs Study to determine how transmission facilities can ease deployment of clean energy, identify high electric demand areas, and evaluate transfer capacity across regions.
ENERGY: ADVANCED TECHNOLOGY VEHICLE MANUFACTURING
The DOE Loan Programs Office published new guidance and a fact sheet for the approximately $17 billion in loan authority in the Advanced Technology Vehicles Manufacturing Loan Program to address deficits in domestic supply chain capacity.
On January 7, the National Telecommunications and Information Administration (NTIA), published a Request for Comment to solicit input and ideas on IIJA broadband implementation including funding, technology, equity, and competition. Commenters were asked to respond by February 4 with specific proposals and relevant data. Among NTIA’s questions: “What guidance or requirements, if any, should NTIA consider with respect to network reliability and availability, cybersecurity, resiliency, latency, or other service quality features and metrics? What criteria should NTIA establish to assess grant recipients’ plans to ensure that service providers maintain and/or exceed thresholds for reliability, quality of service, sustainability, upgradability and other required service characteristics?”
Through February 23, the Department of Commerce is hosting public broadband listening sessions to collect stakeholder input and inform implementation. Input is solicited for: the Broadband Equity, Access, and Deployment Program; the Enabling Middle Mile Broadband Infrastructure Program; and Digital Equity Act programs. The first two sessions had more than 1,400 participants.
For rural customers, Agriculture Secretary Vilsack announced on November 24 that they are accepting applications until February 22 for the existing $1.15 billion in the ReConnect program. IIJA will provide nearly $2 billion for the next round of funding. The Department will issue a NOFO for the new IIJA funding in 2022 but has not set a timeline for the notice.
For multiple new IIJA programs, the Biden Administration is asking: “How do we best implement this program? How will it work for the community, what does technology allow us to accomplish, and what are the pitfalls?” FBIQ recommends actively monitoring listening sessions, stakeholder meetings, and Notices of Intent, Requests for Comments, or other Federal Register notices. A thoughtful, proactive strategy responding as a company and/or through trade associations and industry groups can shape agency guidance and priorities for billions in federal grant funding over the next ten years. Establishing new programs will take time, with a ramp-up of new IIJA program spending in FY23.
This infrastructure work in general is not a one-time economic stimulus. It is not a race to see how many ribbons we can cut before the end of the year. Doing this is going to require balance, it’s going to require order. We are definitely going to go fast, but we are not going to hurry, and we are going to get it right.
White House Infrastructure Coordinator Landrieu,