Infrastructure, Investment, and Jobs Act and the Impact on Local Governments

In November 2021, Congress passed and President Biden signed into law the Infrastructure, Investment, and Jobs Act. This legislation represents an unprecedented $1.2 trillion federal investment in the nation’s infrastructure over the next five years. It is for this reason that many local governments find themselves asking “how can I get my piece of the pie?” While the answer to that question is still somewhat unclear, our office has compiled some insight as to how this funding will be allocated. Here is what we know so far.

• Roughly $330 billion in funding will be earmarked for existing projects awaiting federal approval and investment to proceed. 
• Roughly $660 billion in funding will be allocated to the US Department of Transportation, the majority of which will be distributed to states who will have broad latitude on how to spend it. 
• Roughly $210 billion in funding will be available in the form of competitive grant programs.

While this federal investment will no doubt have a positive impact nationwide, it is important to keep things in perspective. Given the track record of federal spending at the local level, it is likely that a large portion of this funding will be made most accessible to states, large cities, and metropolitan or regional planning organizations. This is a result of the size and regional impact of the projects these organizations can propose, as well as their capacity and capability to properly administer federal funding. 

While there may be limited opportunities for local governments to apply directly to the federal government for funding, we do anticipate that state governments and other recipients of direct federal funding allocations will sub-grant a portion of these funds through a wide range of new and existing grant programs. These sub-grant programs are the likely avenues where local governments will have the most success applying for and obtaining funding. While there is still time before these competitive programs begin accepting applications, there are some key steps you can take as an organization to prepare and strategically plan for when they do.

Identify Priority Projects

The federal government has established priorities for the types of infrastructure projects they are interested in allocating funding towards. Given what we know, local governments should consider identifying and applying for projects that align with one of or more of the following federal priorities.  

• Electric vehicle charging stations that are publicly accessible
• Enhancing the resiliency of surface transportation infrastructure from vulnerabilities due to weather events and natural disasters. 
• Cool and porous pavements and expanded tree cover.
• Active transportation infrastructure for walking, biking, and other micro-mobility modes.
• Safe Streets for All programs that prevent fatalities and injuries on roads and streets.
• Intelligent transportation systems.
• Electric grid resilience systems, including microgrids.
• Combined sewer overflow (CSO) structures, sanitary sewer overflows (SSO), and stormwater management infrastructure needs.
• Digital equity.
• Recycling education and outreach.
• Lead in drinking water.

Start Planning

The federal government places a strong emphasis on projects that can clearly demonstrate positive outcomes based upon the investment being made. However, given the volume of requests they receive and the lack of familiarity they may have with communities requesting funding from them, applicants need to be prepared to make a clear case as to why their project is a priority, the benefits it will have, and their ability to see it through to completion in an efficient and effective manner.  In order to help bridge the knowledge gap, proper planning is necessary. Thoughtful engineering, accurate cost estimates, relevant studies, and strong background documentation are all ways you can help demonstrate why a federal investment in your project is a wise one.

While these steps may seem rudimentary in nature, they are critical to the ability for local governments to position themselves for success. The window for when these grant programs will open to when they will ultimately close is yet to be seen, however, our experience tells us that it will likely be narrow. Having your project(s) identified and your planning done in advance will allow you to spend more time perfecting your proposal, which will help to put you ahead of the pack, and ultimately increase your chances for successful outcomes. Millennium will continue to monitor this funding, and we look forward to providing you with future updates along the way.