Republicans vow to jettison federal highway funding guidance

Republicans are set to challenge a controversial Federal Highway Administration memo outlining how states should spend their IIJA money after the Government Accountability Office ruled that the memo ventures into the realm of policy-making and is thus subject to Congressional review.

Penned by former acting FHWA administrator, and current deputy director, Stephanie Pollack, the memo has sparked debate for more than a year, since it was released in December 2021, less than a month after President Joe Biden signed the Infrastructure Investment and Jobs Act into law.  

Opponents contend it tries to dictate how states should spend the $350 billion of infrastructure dollars under the FHWA’s purview by outlining policies and goals, such as road repair over expansion, that are not included in the IIJA.

The administration has countered that it was only meant as internal guidance to FHWA staff and does nothing to interfere with state’s authority to allocate the funds.

The memo dogged Transportation Secretary Pete Buttigieg during hearings last year and was repeatedly brought up during confirmation hearings for current FHWA administrator Shailen Bhatt.

The Government Accountability Office’s Dec. 15 six-page report disagrees with the administration by declaring that the memo functions as a rule — more than just guidance — and is therefore subject to the Congressional Review Act.

“We acknowledge that states could potentially ignore the preferences that FHWA articulated in the memo and still receive funding from the agency to implement the projects they prioritize and select,” the GAO said. “However, because the memo specifies a goal to inform decision-making and goes beyond simply restating the requirements in the law, consistent with our case law, the memo has a substantial impact despite the non-binding nature of FHWA’s preferences and FHWA’s lack of a direct role in the selection process.”

The Congressional Review Act, enacted in 1996, requires federal agencies to submit a report on each new rule to both Houses of Congress and to the Comptroller General for review before it can take effect. Congress can review and disapprove rules issued by federal agencies for a period of 60 days.

If a resolution of disapproval is enacted, then the new rule has no force or effect.

In light of the GAO’s opinion, Sen. Shelley Moore Capito, R-W.Va., chair of the Senate Environment and Public Works Committee, has promised to introduce a resolution of disapproval “to ensure the IIJA is implemented as written, our states have the flexibility we provided them, and we maximize the investments made in America’s highways, roads, and bridges,” she said in a statement. The IIJA “was crafted and negotiated in a purposeful way, but through memos and guidance documents issued to states the administration has since attempted to contradict the law and impose policies that were specifically left out of the law,” Capito said.

The new chair of the House Transportation & Infrastructure Committee, Rep. Sam Graves, R-Mo., who has pledged heightened oversight of the infrastructure funding in general, has also said he would use the CRA to try to overturn the rule.

State highway advocates like the American Road & Transportation Builders Association and the American Association of State Highway Transportation Officials also support the move to overturn the rule.