White House Unveils New Bridge Funding
To kick off the new year, the Biden-Harris Administration recently released new funding initiatives and plans for the 2023 bipartisan infrastructure law implementation. This includes more than $2 billion from a new program created by the infrastructure law that will go towards “economically significant bridges” across the United States.
President Joe Biden and other officials marked the announcement with a visit to Brent Spence Bridge in Covington, Kentucky, on Wednesday (Jan. 4), which is reportedly known as one of the busiest freight routes and carries far more traffic than it is meant to support. It was also declared obsolete in the 1990s.
“Safe, modern bridges ensure that first responders can get to calls more quickly, shipments reach businesses on time, and drivers can get to where they need to go,” said U.S. Transportation Secretary Pete Buttigieg.
“The Biden-Harris Administration is proud to award this historic funding to modernize large bridges that are not only pillars of our economy, but also iconic symbols of their states’ past and future.”
Large Bridge Project Grants
According to the White House’s Fact Sheet, 2023 will be the first year of Large Bridge Project Grants from the infrastructure law’s Bridge Investment Program. This funding is for bridges with a total cost of more than $100 million, with minimum grant awards of $50 million and maximum awards of 50% of the total eligible project cost.
To improve 4 nationally significant bridges that are vital links for residents, communities & economies, the Biden-Harris Admin & FHWA announced the 1st round of $2.1B Large Bridge Project Grants from Bridge Investment Program. https://t.co/KJnwb143y5 #BipartisanInfrastructureLaw pic.twitter.com/pUqdxt0Av5— Federal Highway Admn (@USDOTFHWA) January 4, 2023
The four projects, which connect communities in fives states, receiving funding include:
The U.S. Department of Transportation reports that, as part of the selection process for this first round of grants, priority consideration was given to projects ready to proceed to construction, as well as those that require pre-construction funding and would benefit from a multi-year grant agreement.
In addition to the four Large Bridge Project Grants, the Federal Highway Administration announced an additional Bridge Planning grant to the U.S. Army Corps of Engineers to advance critical planning work in support of replacement of the Bourne and Sagamore Bridges over the Cape Cod Canal, which were dubbed “functionally obsolete” in 2019.
Biden-Harris' Bridge Investment Program will help fund 4 large bridge projects in 5 states. These & other planning grants are vital to infrastructure that connects communities & freight travel that support our national economy. https://t.co/ptlYBvegZB #BipartisanInfrastructureLaw pic.twitter.com/e10BO1TcHw— Federal Highway Admn (@USDOTFHWA) January 4, 2023
The DOT also reportedly plans to announce more Bridge Investment Program construction grants for bridge projects under $100 million later this year. In total, the program is anticipated to fund $12.5 billion in planning and construction projects over five years, supporting at least one project in every state.
In total, the DOT has announced over $11 billion to upgrade bridges in the country alone, outside of the Bridge Investment Program awards just announced.
“These major bridge investments are a symbol that we can still do big things when we do them together,” wrote the White House in its release.
Bridge Investment Program
In June, the DOT opened a call for applications of the competitive Bridge Investment Program established under the bipartisan infrastructure law. According to the release from the FHWA, the program will provide $12.5 billion over five years, with nearly $2.4 billion available in Fiscal Year 2022 to help plan, replace, rehabilitate, protect and preserve the nation’s bridges.
The Bridge Investment Program is a competitive, discretionary program that focus on the repair, rehabilitation or replacement of existing bridges in the country. The goal is to reduce the overall number of bridges in poor condition, as well as aid bridges in fair condition at risk of declining into poor condition.
Additionally, the program expands applicant eligibilities to create opportunity for all levels of government to be direct recipients of program funds. States, federal lands management agencies, metropolitan planning organizations and local and tribal governments can apply directly to the program, reportedly making it easier to advance bridge projects at a local level.
The DOT reports that the Bridge Investment Program funding is unique in three areas because it:
The new competitive grant program is in addition to the $27 billion in formula funding through the Bridge Formula Program announced at the beginning of the year by the FHWA. In total, the $40 billion investment is expected to fund numerous bridge improvement projects across all 50 states.
The first round of funding was released by the FHWA in October, totaling $18.4 million going towards 23 projects in 23 states to create a long-term pipeline of construction-ready bridge projects. The bipartisan infrastructure law provided a total of $20 million in fiscal year 2022 funding for Bridge Planning grants.
The DOT reports that, in total, the Bridge Investment Program will be the largest dedicated investment in bridges since the construction of the Interstate highway system, reaching $12.5 billion over five years.
The FHWA stated at the time they would reserve the remaining $1.6 million to award projects identified under the upcoming Large Bridge Project grant awards that may be better suited for a planning grant than a construction grant.
Increased Capital Spending
A recent report from the National Association of State Budget Officers showed that while total state spending rose 7.3% overall in fiscal year 2022, infrastructure construction spending increased 15.3%, thanks to funding from the bipartisan infrastructure law.
According to NASBO, this percentage is the highest annual figure since 1994, and is only expected to grow over the next several years because of the funds from the Infrastructure Investment and Jobs Act, as well as the American Rescue Plan Act.
The annual report outlines that capital expenditures are made for new construction, infrastructure, major repairs and improvements, land purchases and the acquisition of major equipment and existing structures. Minor repairs and routine maintenance are also reported as operating expenses.
In this category, capital spending has increased the past three fiscal years in 2020, 2021 and 2022 at 4.3%, 3.6% and 15.3%, respectively. The latest figure is reportedly the highest growth rate since 1994, largely due to federal government funding.
Under the ARPA, states and localities are permitted to use federal funding for investments in infrastructure, including water, sewer and broadband services. The IIJA includes approximately $550 billion in new spending for roads, bridges, rail, transit, the electric grid, water systems and broadband.
Specifically looking at transportation, which is the largest category of state capital expenditures, this category comprises 65.4% ($93.4 billion) of all capital expenditures in fiscal 2022. This was an increase of 18.7% from the previous year and rose 54.1% from fiscal 2009.
The amount of reported capital spending would be larger, however, but a dozen states treat capital spending on the construction and maintenance of roads, bridges and mass transit differently than other capital spending, NASBO reported.
For these figures, transportation expenditures totaled $208.7 billion in estimated fiscal 2022, 7.3% of total state spending and an increase of 19.5% over the previous year. State governments contributed 73.3% of transportation expenditures in fiscal 2022, while federal dollars accounted for 26.7%.