Appropriations process creating uncertainty
3 min read
Byron Buck
Congress returns to work with a full agenda including nine spending appropriations bills that need to be hammered out as infrastructure spending from the previous administration tails off and promises for funding to the states remains in doubt.
“A full year obligation has gone out to states, but with a big asterisk and caveat that if we have a continuing resolution, it could get pulled back,” said Susan Howard, director of policy and government relations for the American Association of State Highway and Transportation Officials.
“There’s trepidation about moving too far forward on getting bids if there’s any chance that the federal funds won’t be there when we need them.”
The comments came from a webinar produced by the Eno Center for Transportation last week.
The federal government obligates payments to state-level departments of transportation, but the Trump administration has made a habit out of rescinding funding for projects associated with green energy or Diversity, Equity and Inclusion provisions.
The deal Congress stuck includes funding for the government only through January 30, with nine appropriations bills, including Transportation and Housing and Urban Development stuck in neutral.
The appropriations process is stymied by a lack of agreement on topline discretionary spending limits for the fiscal year which started Oct. 1.
“We are a little bit less than a year from the expiration of the Infrastructure Investment and Jobs Act and we are really trying to understand what the new baseline should be taking into effect the inflationary impacts that we’ve seen,” said Howard.
Inflation left over from the pandemic took a major bite out of infrastructure funding, a problem the industry is trying to correct with baked in solutions.
“Our recommendation was for the first year of a new bill, let’s increase it (funding) to restore the purchasing power,” said Alison Black, chief economist for the American Road & Transportation Builders.
“Just looking at the Consumer Price Index, let’s at least get it to where the original authors wanted us to be with that that big increase in investment.”
In addition to possible recissions and inflation, the industry has also been struggling with Build America, Buy America requirements that restrict against using non-domestic suppliers.
“State DOT chiefs are very supportive of domestic manufacturing and growing that base,” said Howard.
“But we have a new situation here with the whole complex category of materials that have never been subject to Buy America requirements.”
BABA rules can be avoided via waivers which now must be approved by the Made in America Office within the White House Office of Management and Budget.
The public takes a keen interest in transportation projects, with public transit measures passing in 13 out of 16 races in the recent election.
“We look at local and state ballot initiatives related to transportation funding and 82% of those were approved,” said Black.
Sam Graves, chairman of the House Transportation and Infrastructure Committee recently
“Never has the need been so great but the resources so small,” he said.
