Infrastructure Update: Feds Stake Out Priorities for Highway Dollars

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Hello and welcome back to Route Fifty's Infrastructure Update, I'm Dan Vock. Today we are looking at the Biden administration's early attempts to shape how states and other entities use an influx of federal highway money that's being handed out under the new infrastructure law.

Guidance the Federal Highway Administration issued last week makes clear that the administration wants to see funding go towards fixing existing roads rather than building new ones. It also signals support for projects that promise to reduce carbon emissions, expand transit, add bike lanes and incorporate stakeholders like local governments.

Every administration has its own priorities, but usually the U.S. Department of Transportation emphasizes these through the kinds of projects it picks for discretionary grants or with the creation of new programs. 

Highway dollars, on the other hand, are more or less automatically given to states. And Congress has granted states wide latitude in how they can spend the federal road money, with the bulk of it distributed based on formulas written into law. While the FHWA's guidance doesn't carry much legal weight, it marks a shift in the approach that DOT has typically taken towards distributing highway dollars, with the Biden administration getting more assertive in trying to put its imprint on this funding as well.

A leading group of local transportation officials applauded the administration's move. But at least one Republican governor is already bristling over the idea of the White House trying to steer how the new infrastructure dollars are spent in his state.

What's in the Guidance?

Stephanie Pollack, the deputy administrator of the Federal Highway Administration authored the new guidance memo. "Projects to be prioritized," she wrote, "include those that maximize the existing right-of-way for accommodation of non-motorized modes and transit options that increase safety, accessibility, and/or connectivity."

The memo also encourages states to make road upgrades that incorporate "safety, accessibility, multimodal, and resilience features."

Pollack, a former environmental activist who led Massachusetts' transportation department, indicated that the agency would apply more scrutiny to the environmental impact of road projects, especially when it comes to greenhouse gas pollution.

Her letter doesn't change anything about existing law or regulations. But Pollack did suggest a few ways that it could affect how the agency operates in the future, especially when it comes to conducting environmental reviews of proposed projects:

• Projects that add bike lanes, bike paths and pedestrian amenities would be exempt from additional reviews under the National Environmental Policy Act (NEPA).
• Highway projects that involve the taking of more land, that would cause changes in land use or that would change travel patterns would not be able to get those types of exemptions.
• The FHWA would "encourage—and where permitted by law, require—recipients" of the federal highway money to improve existing infrastructure instead of adding travel lanes that mainly serve single-occupancy vehicles.

Instead of building bigger roads or bridges, Pollack wrote, "state transportation departments should also be mindful of their ability to transfer resources to support transit projects that may be more consistent with these priorities."

Pollack added that the FHWA wanted to work more with stakeholders and decision makers outside of just state transportation agencies—"including local and tribal governments that have not traditionally had access to needed federal funds to ensure these goals are fully realized."

Many of the roads that need repairs the most are owned by local governments, she noted. And Congress set aside money in the infrastructure package that could be used by either state or local transportation agencies for purposes like fixing bridges.

Mixed Reactions

Corinne Kisner, the executive director of the National Association of City Transportation Officials, praised the Biden administration's approach.

"Breaking from decades of no-strings-attached federal funding for transportation, this administration has committed to taking a hands-on approach to ensure federal dollars upgrade the quality of the country's infrastructure, improving safety, resilience, accessibility, and equity in the process," she said in a statement.

Of course, it's yet to be seen how state agencies will react. State transportation departments have fought to keep their autonomy over the years, arguing that they know local circumstances better than officials in Washington.

Since the infrastructure bill became law, governors of both parties have indicated that they would use the new money for major highway expansions. 

Political disagreements could add to the complexity. The federal infrastructure bill passed Congress with a few Republicans joining Democratic majorities. Now that it's law, though, Republican state leaders may chafe at any attempt by the Biden administration to promote its climate and racial equity goals with the money.

Texas Gov. Greg Abbott, a Republican, sent a letter to state agencies earlier last week, before the FHWA guidance was released, cautioning them about applying for new federal funds.

"Should the acceptance of any federal funds hinder or needlessly constrain the state, commit the state to ongoing costs for which there is not an appropriation available, or require an agency to implement a federal policy contrary to the law or policy of this state, the agreement proposed by the federal agency should not be signed. Please be vigilant and communicate frequently with my office before you proceed with accepting or applying for federal funding opportunities," he wrote.

That's it for this week's edition. If you haven't already, consider signing up here for Route Fifty Today, our daily newsletter, where you can stay up to date on the latest trends and best practices happening in state and local government nationwide. If you have news tips or feedback, if you want to share your community's story, or if you just want to say hello, please email me at dvock@govexec.com and follow me on Twitter at @danvock. Thanks for reading!