Upcoming August Redistribution and New DOT Funding Sources

The outcome of the federal budget making process for Fiscal Year 2018 is still uncertain, but as a result agencies may soon see an above average influx of federal dollars for transportation infrastructure as part of the Federal Highway Administration’s annual “August Redistribution.” In late summer of each year, the FHWA redistributes unused funding allocated for specific programs to projects that will be able to use the funding before the end of the federal fiscal year on September 30. Last year, the total reallocation from the August Redistribution was $2.8 billion. For this year’s redistribution, states had a deadline of July 19, 2017 to submit lists of projects that may fit the criteria for funding. In California, the California Transportation Commission currently budgets a conservative estimate of $162 million of funding from this annual redistribution based on fiscal years from 2011-2015, and distributes 37% of the total federal funding to local agencies for priority projects. Local agencies in turn request portions of this funding for projects that are shovel-ready and can proceed to construction. To take advantage of this funding opportunity, the San Joaquin Council of Governments (SJCOG) recently discussed shifting unused funding from the construction phase of improvements to the McHenry Avenue Corridor to the final design phase of the reconstruction of the State Route 99/State Route 120 interchange to move the project towards construction. IMS tracked the RFP announcement for the design phase of the McHenry Avenue Corridor Improvements in 2007 as IMS Project No. 140221-12 as well as the latest SJCOG announcement of on-call contracts for roadway design (306164-1).

(Map of SJCOG’s proposed SR-99/SR-120 Connector Project. Image Source)

Although states tend to budget conservatively for the August Redistribution, recent changes to grants distributed under the 2015 Fixing America’s Surface Transportation (FAST) Act will mean that a large amount of funding allocated under that law will go unused and subsequently be redistributed before the end of the fiscal year. Earlier this month, the Department of Transportation announced that the criteria of the associated FASTLANE Grant Program would be revised and included in a new program, Infrastructure for Rebuilding America (INFRA). Since 2015, funding under the FAST Act has been used to finance a variety of roadway, freight, and other transportation infrastructure projects, and IMS has tracked several consulting opportunities related to the FASTLANE Grant Program this summer. The City of Edmonds in Washington released a solicitation last month for engineering work on the Edmonds Street Waterfront Connector, which was proposed to be funded under the FASTLANE Program (see IMS Project No. 388850). Charlotte, North Carolina recently released a solicitation for application assistance for a FAST Act grant to fund an adaptive traffic signal system (391880).

(Macon County and Decatur, IL are competing for FAST Act funding for roadway infrastructure around the Midwest Inland Port. Image Source)

As the criteria for grants under the FAST Act have been revised for the INFRA Program, many agencies must re-submit applications for their projects. The State of Maryland applied for funding under FASTLANE for transportation infrastructure in Baltimore, but did not receive an award during the 2016 cycle. Although the State must now re-submit an application for the 2017 INFRA Program, it may offer a chance for these high-priority projects to receive funding in the coming year. The new criteria favor projects that utilize innovative delivery methods and private financing, which agencies are already taking into consideration for their applications. In Macon County, Illinois, the city and county are planning to leverage private financing in their application to the INFRA Program for roadway infrastructure around an expanding inland port.

Other transportation grant programs, such as the TIGER Program, may also be rewritten or defunded, but the federal budget process is far from over. Although the President’s budget request defunded both the TIGER and CDBG Programs, the Senate Appropriations Committee recently returned with a proposed budget that maintains or increases the funding levels of both programs. As the priorities for federal funding fluctuate, IMS maintains contact with local agencies to keep informed about pending grant applications and projects competing for federal funding. As we approach a new federal fiscal year with an uncertain funding landscape, IMS remains the best resource for timely and accurate project information.

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