The nation’s governors—who will play a central role in converting the new infrastructure law’s billions of dollars into tangible upgrades for highways, water systems, broadband and other types of public works—are awaiting guidance from federal agencies about the ground rules for using or applying for the types of aid that the landmark measure promises to provide.
The Infrastructure Investment and Jobs Act (IIJA), which President Joe Biden signed into law on Nov. 15, is the focus of a three-day National Governors Association “infrastructure summit” meeting in Annapolis, Md. The legislation's total price tag has been estimated at $1 trillion to $1.2 trillion.
In a Nov. 30 panel discussion to wrap up the meeting's first day, four governors praised the legislation as a major plus. Maryland Gov. Larry Hogan [R] said the new law will be a “game changer” for his state. “It is going to enable us to move forward on a lot of transformational projects,” he added.
Hogan said Maryland officials don’t expect to receive funding from the bill until 2022 and are waiting for federal agencies to issue guidance documents regarding how the IIJA's many parts and programs will operate. “We don’t know the exact timing and exactly what strings will be attached to what portions of money,” he said.
The Federal Highway Administration is getting out to an early start. The agency on Nov. 30 announced the launch of a website that it describes as a “one-stop shop,” providing IIJA information to state and local agencies, communities and other interested parties.
Seek Implementation Suggestions
FHWA also is issuing a request for information, published in the Federal Register on Dec. 1, seeking suggestions from the public on how to implement the agency's sections of the new law.
FHWA Deputy Administrator Stephanie Pollack said in a statement that “to realize [the IIJA’s] full potential we need to hear from the public, especially on how FHWA should address the opportunities and challenges associated with both changes to existing programs and the creation of new programs.”
Louisiana Gov. John Bel Edwards (D) said at the governors' conference that the new law would be “transformational.” He said his state would receive about $6 billion for the highway and bridge sector, a 20% increase from sums it receives under current distribution formulas.
Pennsylvania Gov. Tom Wolf (D), said, “We absolutely need all the things that this bill brings.” Wolf noted that his state has one of the largest numbers of bridges among the states. But he added, “We need broadband. We need to make sure that everybody is served—rural areas as well as urban areas.”
Wolf suggested three broad priorities—putting the IIJA funding to work in projects quickly, avoiding “political gamesmanship” in allocating funds within each state, and making sure that the IIJA-funded infusion can be sustained beyond the next 10 years.
“We’re all getting a lot of money from this [law],” Wolf said, “but it’s not…an infinite amount of money.”
He also said more states should institute a “special purpose authority,” an entity that would operate as a kind of infrastructure bank.
Those authorities would use the federal funds a state receives to attract private funding. But Wolf said the authorities would have to be "accountable" and the projects actually be beneficial. “They couldn’t be bridges to nowhere,” he said. “They‘d have to be bridges to somewhere.”
Hogan, a big supporter of public-private partnerships (P3s) on transportation projects in his state, noted that the IIJA has some P3-related provisions.
The measure, for example, raises the cap on private-activity bonds for highway projects to $30 billion, from the earlier $15 billion, according to the National Association of Counties.
The bonds, authorized by the U.S. Dept. of Transportation, allow a private entity to benefit from the lower interest rates for tax-exempt bonds. The association says that increase will permit counties to take part in more transportation P3s.
Story updated on 12/2/2021 with link to FHWA request for information on implementation of IIJA highway and bridge provisions.
