Senate Passes Infrastructure Bill, Congress to Consider
On Tuesday, the Senate passed the bipartisan infrastructure bill, the Infrastructure Investment and Jobs Act (IIJA), by a vote of 69-30, which represents a significant step forward on $550 billion in new federal investments in America's infrastructure that cities and towns can benefit from. The bill now moves to the House, where Speaker Nancy Pelosi has committed to bringing the bill up along with the reconciliation instructions. However, it is not guaranteed that the House will pass the current bill.
The bill includes funding for rebuilding transportation connectivity, investing in water and climate resilience, broadband access, digital equity, cybersecurity, and bonding provisions.
The key programs and funding for municipalities include:
Rebuild Transportation Connectivity
Our federal partners, the National League of Cities (NLC) asked Congress to invest with municipalities and give local governments a fighting chance at new programs – for safety, bridges, technology, and more– as well as to make sure that the Surface Transportation Block Grant (STBG) and other programs reached cities of all sizes. The Senate provided $124 billion in competitive funding from US Department of Transportation programs across transportation modes and added an additional population bucket of STBG to ensure different size municipalities can more clearly see how states will spend to support them.
IIJA also provides important financing opportunities for local governments including:
- $5 billion in “Safe Streets for All” program that directly supports local governments' “vision zero” plans and other improvements to reduce crashes and fatalities, especially for cyclists and pedestrians.
- 5 billion in National Infrastructure Project Assistance grants that will permit eligible municipalities to apply for funding to complete critical large projects that would otherwise be unachievable without assistance.
- Additional $7.5 billion in RAISE grants (formerly TIGER/BUILD) and $8 billion in INFRA grants to rebuild critical community transportation infrastructure projects.
- $500 million for SMART Grants demonstrating transportation technology integrations, building on the success of smart cities and prior challenges.
- $2.5 billion in Electric Charging and Fueling Infrastructure competitive grants to strategically deploy publicly accessible charging infrastructure along designated alternative fuel corridors.
- $1 billion for the new “Reconnecting Communities” program, which will support planning and construction to remove barriers to community connectivity and rectify harms caused by past transportation investments.
- Transit’s Capital Investment Grant program increases with $3 billion authorized per year, and a new $1.75 billion All Stations Accessibility Program and $250 million under the “Enhanced Mobility for Seniors and Individuals with Disabilities” program.
- $66 billion investment in rail with $12 billion dedicated to partnership grants for intercity rail service, including high speed rail, and $5 billion for the Consolidated Rail Infrastructure and Safety Improvements Program (CRISI), which funds projects that improve the safety, efficiency, and reliability of intercity passenger and freight rail.
Invest in Water and Climate Resilience
While IIJA includes the Senate-passed Drinking Water and Wastewater Infrastructure Act, which NLC supported and which authorizes a number of programs and grant opportunities for drinking water, wastewater and stormwater management and support for resilience, innovative technologies, workforce development and watershed/source water protection, among others, it does not provide funding for these grants.
IIJA provides important financing opportunities for local governments, including:
- Over five years, $11.713 billion for the Clean Water and Drinking Water State Revolving Funds (SRFs), with 49% as principal forgiveness/grants and 51% as loans.
- Over five years, $15 billion for lead pipe replacement through the Drinking Water SRF, with 49% as principal forgiveness/grants and 51% as loans.
- Over five years, $10 billion in grants to address emerging contaminants and PFAS drinking water contamination with $1 billion through the Clean Water SRF; $4 billion through the Drinking Water SRF; and $5 billion for underserved communities.
- $75 million for the Army Corps WIFIA program for safety projects to maintain, upgrade and repair dams identified in the National Inventory of Dams.
Climate Change and Resilience
IIJA includes provisions for energy efficiency, electric grid resilience, pre-disaster mitigation, drought and Western water resilience, and flood and wildfire mitigation. Moreover, the transportation sections of the bill invest in electric vehicles and charging infrastructure, establish a carbon reduction program to reduce transportation emissions and establish a formula and competitive grant program to help states improve the resiliency of transportation infrastructure. The NLC called on Congress to help local leaders build resilient communities by ensuring that our nation’s infrastructure can withstand the impacts of climate change and extreme weather events.
- $550 million for the Energy Efficiency and Conservation Block Grant, which is a key priority for NLC.
- Over five years, $500 million for the Low-Income Housing Energy Assistance Program.
- $250 million for a new Energy Efficiency Revolving Loan Fund.
- $225 million for grants to implement updated building energy codes.
- $8.3 billion for Bureau of Reclamation western water infrastructure, including for aging infrastructure, water storage, water recycling and reuse, waterSMART, and drought contingency plans, among other things.
- $500 million for the STORM Act to provide support through loans and grants to local communities facing rising water levels, coastal erosion, and flooding.
- $3.5 billion for the FEMA Flood Mitigation Assistance Program, which helps provide financial and technical assistance to states and communities to reduce the risk of flood damage to homes and businesses through buyouts, elevation, and other activities.
- $1 billion for the FEMA Building Resilient Infrastructure and Communities (BRIC) Program, a pre-disaster mitigation program supporting states, local communities, tribes, and territories undertaking hazard mitigation projects to reduce the risks they face from disasters and natural hazards.
IIJA provides funding for environmental cleanup and municipal recycling programs, including:
- Over five years $1.5 billion for the EPA Brownfields program to help communities, States, Tribes, and others to assess, safely clean up and sustainably reuse contaminated properties.
- For five years $3.5 billion for the Hazardous Substance Superfund program to allow EPA to invest in clean-ups and continue moving forward on remedial actions for Superfund sites.
- Over five years $275 million for grants to states to support improvements to local post-consumer materials management, including municipal recycling programs, and to assist local waste management authorities in making improvements to local waste management systems. This program was authorized in the Save Our Seas Act 2.0, which was signed into law last year.
- $75 million for grants to states and local governments focused on improving material recycling, recovery, management, and reduction. The new EPA program would help educate households and consumers about residential and community recycling to decrease contamination in the recycling stream.
Broadband Access, Digital Equity and Cybersecurity
The IIJA includes the largest-ever one-time federal investment in broadband at $65 billion, including programs for broadband infrastructure buildout, affordability, and digital equity. The bill also includes investments in local cybersecurity through a new state and local government cybersecurity fund. NLC called on Congress to make federal investments to close the digital divide and provide equitable access to the internet for people in all communities.
- $42 billion for the Broadband Equity, Access and Deployment Program. This program would provide formula grants to state governments to award sub-grants for broadband planning, mapping, deployment, and adoption programs, prioritizing unserved areas, underserved areas, and anchor institutions. States would be required to coordinate with local governments when drafting plans for approval by the National Telecommunications and Information Administration (NTIA) prior to receiving funds.
- $1 billion for Enabling Middle Mile Broadband Infrastructure. This program would create a competitive grant program administered by NTIA for construction, improvement, or acquisition of middle mile broadband infrastructure. Local governments are among the eligible awardees.
Digital Equity and Broadband Affordability
- $1.3 billion for the Digital Equity Act, establishing two categories of digital equity grants: state formula grants and competitive grants, which local governments and nonprofits could access directly. These funds are to be used for digital inclusion work, such as connecting residents in need to devices, subsidized broadband subscriptions, and skills training.
- The Affordable Connectivity Program, to extend and modify the Federal Communications Commission’s (FCC) Emergency Broadband Program for an additional five years, dropping the monthly discount to $30 per household.
- Policy changes such as Consumer Broadband Labels, Broadband Speed Study, and Digital Discrimination.
- $120 million for the Cyber Response and Recovery Act, to allow the Secretary of Homeland Security to declare a Significant Cyber Incident and provide direct support to impacted entities, and establishes a Cyber Response and Recovery Fund of $20 million per year for six years to support it.
- Over four years, $1 billion for the State and Local Cybersecurity Grant Program. This establishes a cybersecurity grant program that provides for states and localities to develop and implement cybersecurity plans and address imminent cybersecurity threats. Funds are routed through states and allocation plans must be developed in consultation with and approved by localities.
- $250 million Rural and Municipal Utility Advanced Cybersecurity Grant and Technical Assistance Program. Additionally, directs a study on incentives to encourage public utilities to invest in cybersecurity and participate in ISACs, establishes an incentive program, and directs EPA and CISA to identify public water systems vulnerable to cyberattack and develop a plan for providing technical support.
The IIJA contains two new uses for private activity bonds and expansion of another.
- First, The IIJA incorporates a proposal from Senators Shelley Moore Capito (W. Va.) and Maggie Hassan (N.H.) to allow local governments to issue tax-exempt bonds to finance rural broadband projects. This would allow for cheaper financing of new broadband to be installed in rural areas.
- Second, The IIJA incorporates a proposal from Senators Rob Portman (Ohio) and Michael Bennet (Colo.) that would help reduce the cost of commercializing the purchase and installation of carbon capture, utilization, and storage equipment, as well as direct air capture (DAC) projects through the use of private activity bonds. Carbon capture removes carbon dioxide from an emissions stream at a power plant or industrial facility reducing emissions from energy-intensive industries. DAC is an innovative emerging technology that removes carbon dioxide directly from the atmosphere. These technologies assist in reducing emissions and protecting the environment while continuing to use our natural resources, but first-generation facilities can cost upwards of $1 billion. Cities could issue private activity bonds and provide financing to these projects a discount to what it would take if a company developing this technology did it itself.
- Finally, the IIJA increases the current cap of tax-exempt highway or surface freight transfer facility bonds from $15 billion to $30 billion. Nearly all of the $15 billion cap is issued or allocated. This will allow cities to engage in Public-Private Partnerships and expand the volume of financing to supplement future financing needs.
As we have previously asked, it is critical that New Jersey municipalities highlight infrastructure needs and successes on social media and tag federal members, especially your congressional representatives.
Using the hashtags #RebuildWithUs and #LeadWithInfrastructure, please share pictures, graphics and descriptions of local infrastructure needs and success stories on your social media accounts. Examples of tweets can be viewed on the League’s Social Media Sample Page.
Contact: Paul Penna, Legislative Analyst, email@example.com, 609 695-3481, ext. 110.