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Perspective: IIJA Implementation Is No Small Feat

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With President Biden’s pen down and the ink on the bill now dry, funds appropriated in the Infrastructure, Investment and Jobs Act (IIJA) will begin to flow from the Department of Treasury to federal agencies and state governments who are tasked with overseeing projects and programs, both new and existing. From clients to consultants and everyone in between, the $1.2 trillion question is…

…how quickly will we see these dollars spent? 

States, municipalities, and the individual citizen are sure to benefit from the more than $550 billion in funding increases [1]. Major portions of the new spending and the underlying surface transportation reauthorization are outlined for new programs, but these programs must be started from the ground up and will require further design, outline, and implementation by the overseeing federal agencies. Funding of this magnitude will also require careful oversight to ensure government dollars are allocated and spent wisely. Combining these efforts seamlessly is no small task, especially for the United States Department of Transportation (USDOT), who will receive a record $284 billion over their annual baseline spending [2]. 

If your team has a particular interest in new aviation programming and spendingcheck out this article detailing 3 new programs 

To assist with the federal government’s response, on November 14th, President Biden named former New Orleans Mayor Mitch Landrieu as the Senior Advisor and Infrastructure Coordinator of the IIJA. He will be the federal government’s point man, tasked with coordinating implementation, or making the “rubber meet the road.” Landrieu is well known and respected for his efforts to turnaround the City of New Orleans post-Katrina, and for his success in the cleanup of the BP oil spill in the Gulf of Mexico, proving he is no stranger to a monumental task [3]. 

Alongside Landrieu, Secretary Pete Buttigieg and key deputies at the USDOT have also been hard at work, outlining agencies key priorities through briefings held over November 9th and 10th and making the rounds across television and the White House press podium to outline their agencies proposed response.  When quizzed by the press, Secretary Buttigieg was optimistic on how quickly competitive grants will begin to flow [4].

“[DOT] has been gearing up, hoping the bill would pass. And now that is has, we’ve taken it to the next level.”

Pete Buttigieg

Separately, Deputy USDOT Secretary Polly Trottenberg outlined that with the expanded programming now authorized, USDOT would have to “hire new staff to get these programs up…[USDOT] will need to grow” [5].

These actions from the Biden Administration suggest that programs and their funds could be moving more quickly than expected; however, there are several forces standing in their way. History shows us that the pace of federal fund distribution is unequal, evidenced in the American Recovery and Reinvestment Act, where repair programs often moved faster than new capital grant programs. Tightness in the labor market could hinder agencies ability to hire qualified staff and the White House’s increased focus on the supply chain could suck bandwidth from the USDOT as they continue to manage response to shipping and trucking shortages. With new programming comes new rulemaking, which will take time and effort to ensure compliance with existing regulations and laws. Finally, states and municipalities face headwinds in mobilization of matching funding, expanding bond offerings, and raising capital as coffers have shrunk over the past two years in the pandemic.  

Although these headwinds are significant, at Anser we are currently advising clients to organize and plan strategically, begin necessary budget and funding conversations, and staff up where appropriate to take advantage of this historic investment. With the full weight of the government and the necessary funding already appropriated to begin this infrastructure push, we expect to see results and dollars flowing in the near term as opposed to the later, so gather your teams and get planning.

As the old saying goes, if you’re not at the table, you’re on it, so find your seats quickly!