A Senate Committee on Environment and Public Works hearing on February 26 delved into the impact of the Infrastructure Investment and Jobs Act or IIJA of 2021 and how that legislation could impact the structure of the next surface transportation reauthorization funding bill.
[Above photo via the Senate EPW committee]
“This hearing comes at a critical time, I think, as we approach the expiration of [transportation funding] provisions by the end of 2026,” explained Sen. Shelley Moore Capito (R-WV), chair on the EPW committee, in her opening statement.
“We want to continue what is working, but discontinue what isn’t working,” she added. “As an example, the IIJA codified the One Federal Decision policy, which expedites, or should expedite, the environmental review process for certain projects by setting a two-year goal for those reviews and allowing the use of a single coordinated process to develop an environmental document. I am curious to hear from our witnesses today, if these provisions are being used and whether they have been having the desired impact. Despite the many benefits, I am aware that we have some challenges with the implementation of the IIJA.”
Sen. Sheldon Whitehouse (D-RI), ranking member of the EPW committee, echoed Sen. Capito’s position on the need for timely passage of the next surface reauthorization bill.
“I would like to join with you, my Republican colleagues, to take stock of our bipartisan infrastructure law, craft policies to fix our aging roads and our bridges, and pass a package before the current law expires in September 2026,” he said in his opening statement. “This would be a reasonable course of action, regardless of who is president.”
[Editor’s note: Both Sen. Capito and Sen. Whitehouse detailed some of their views on the next surface reauthorization bill in remarks made at the American Association of State Highway and Transportation Officials 2025 Washington Briefing in Washington, D.C., on February 6.]
The EPW hearing – formally entitled “Infrastructure Investment and Jobs Act Implementation and Case Studies” featured three witnesses: Russell McMurry, commissioner of the Georgia Department of Transportation and AASHTO 2024-2025 vice president; Gary Johnson, vice president of Granite Construction Inc. on behalf of the Transportation Construction Coalition; and Michael Carroll, deputy managing director of the Office of Transportation and Infrastructure Systems for the City of Philadelphia and president of the National Association of City Transportation Officials.
In his testimony, Georgia DOT’s Russell outlined four key principles state departments of transportation and AASHTO believe Congress should base its surface reauthorization efforts upon:
- Ensure Timely Authorization of a Long-Term Federal Surface Transportation Bill as it is crucial that a new authorization bill be enacted by September 30, 2026.
- Increase and Prioritize Core Formula-Based Federal Funding Provided to States as distributing federal funds by formula remains the optimal approach to support the nation’s transportation system.
- Maximize State Flexibility to Deliver Projects that Advance Safety, Efficiency, and Innovation meaning that Congress should provide increased flexibility and transferability between formula program categories and combine programs that have similar policy objectives in the next surface reauthorization bill.
- Enable the States’ and Nation’s Future Success with Robust Federal Funding meaning Congress should build upon the base funding level provided in the IIJA through both the Highway Trust Fund and General Funds in the next surface reauthorization bill to ensure, at a minimum, that federal transportation funding can keep pace with inflation.
McMurry stressed in his testimony that “core IIJA formula programs” give states funding certainty to properly plan and deliver for the future. “Federal funding is a foundational investment, vital for the state of good repair for our nation’s highways and bridges,” he explained. “In Georgia, about 80 percent of our capital maintenance program is from the IIJA formula programs and represents 90 percent federal investment for bridge rehabilitation and replacements.”
He also pointed out that moving people and freight safely and efficiently involves more than just building transportation infrastructure – it is about improving the nation’s economy and the quality of life for all of the country’s residents.
“That is why the IIJA’s federal surface transportation funding has been absolutely vital to every state to safely move people and goods,” McMurry said. “It helps us deliver projects across our very diverse state from the coast to the mountains; from rural Georgia, where agribusiness is our number one economy, to metro Atlanta, with its more than 6 million people.”
Yet inflation over the last four years has resulted in major cost increases for the materials required to build safe and resilient transportation infrastructure, he emphasized; costs that need to be accounted for in the next surface reauthorization bill.
“Georgia, like most every state, has experienced significant cost increases that has eroded the buying power expected from the IIJA,” McMurry noted. “In Georgia, we’ve seen a 60 percent increase in bridge costs, a 66 percent increase in resurfacing costs, and an over 115 percent increase in the cost of [road] widening-type projects.”
That’s why McMurry believes providing more formula funding instead of discretionary grants in the next surface reauthorization bill will be key to helping states cope with those cost increases.
“Under IIJA, discretionary [grant] funds have been slow to deploy for both state DOTs and local governments,” he said. “One local grant in Georgia took 31 months from Notice of Funding Opportunity to the Grant Agreement execution. Other challenges result from so many discretionary programs, with 29 of them just at FHWA [Federal Highway Administration] alone.”
Formula funding, by contrast, flows faster and can be “flexed” to a degree so states can better focus on the specific transportation needs of their regions.
“It enables funds to be distributed to states in a stable and predictable manner and allows states to efficiently deliver projects identified and prioritized through the statewide and metropolitan planning process,” McMurry said. “According to a Congressional Budget Office estimate, 67 percent of formula dollars provided to states are estimated to be ‘spent out’ via cash – and thus put into tangible projects – by year two of IIJA. Conversely, discretionary grants under the IIJA have only been ‘spent out’ at a rate somewhere between 1 percent to 7.4 percent by year two. That is likely because core formula programs fund projects that are in the constantly moving [planning] pipeline, whereas discretionary grant awards have often targeted projects that have not been considered through the planning process.”
He also stressed that formula funds allow states to transfer some of those funds between programs – helping state DOTs deliver “the right project at the right time” to meet their transportation system needs.
That is why McMurry stressed that Congress should increase the extent to which formula funding is prioritized over discretionary funding by ensuring that 95 percent or more of authorized
Highway Trust Fund highway dollars go to apportioned programs for states in the next surface reauthorization bill.
“Formula dollars provide stability, predictability, and efficiency, allowing state and local governments to plan and deliver projects effectively,” he pointed out. “If there is a desire to address additional priorities, the most efficient way to meet those priorities is through expanded eligibility within existing formula programs.”
Top Stories
Video: Profile of AASHTO President Garrett Eucalitto
February 28, 2025
Top Stories
