Buttigieg says DOT will provide $2.9 billion in infrastructure grants

U.S. Secretary of Transportation Pete Buttigieg addresses the media during a press briefing at the White House in Washington, U.S. November 8, 2021.

Leah Millis | Reuters

Transportation Secretary Pete Buttigieg on Wednesday said the administration is ready to provide $2.9 billion in grants for state and local bridges, roads and other infrastructure projects.

The amount, part of a bipartisan $1 trillion infrastructure bill signed by President Joe Biden four months ago, is intended to fund public works projects, including expanding and repairing highways, bridges, freight, ports and mass transit.

Buttigieg told reporters Tuesday that applications for funds must be submitted by May 23 at 5:00 pm ET, with approval expected in the fall.

“Over the past year, I have traveled and seen some of the most egregious and serious infrastructure needs in this country,” the transport minister said. “Often we see infrastructure that is generations old and in dire need of repair or replacement.”

State, regional and local governments will be able to apply for grant funding under three separate programs with a single application.

The National Infrastructure Project Assistance Program is designed for large-scale projects that do not cover jurisdictions or are “regional projects of significance”. The Department of Transportation will provide 50% funding for projects over $100 million and share $1 billion in funds over the first year.

The second program, known as Infrastructure for America’s Recovery, is designed to fund small projects to build roads, trucks, and railroads. Biden Infrastructure is committing $8 billion to this program over five years.

The remainder of the funding will go towards funding the Rural Land Transportation Subsidy Program with funds available exclusively to rural communities. As part of this project, about $300 million in grants will be allocated in 2022.

The $2.9 billion is a large, albeit small, portion of the trillion-dollar infrastructure bill the president passed in November. The White House said in a press release Wednesday morning that the fast review and streamlined application process will make it easier for state and local governments to build a portfolio of “ready to go” projects and eliminate supply chain bottlenecks across the country.

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“These investments will create well-paying jobs, boost the economy, reduce emissions, improve safety, make our transportation more resilient and sustainable, and expand transportation options in rural America and other underserved communities,” the administration said in a statement.

The broader legislation directs $110 billion in additional funds for road and bridge repairs, $65 billion for broadband, and about $90 billion for guaranteed public transport funding over five years.

While most of Wednesday’s announcement focused on the details of the grant applications, the administration said it sees infrastructure projects as a means by which it can overcome supply chain hurdles blamed on soaring inflation.

“Through the bipartisan Infrastructure Act, this funding will enable more communities to build vital infrastructure projects that also strengthen supply chains and reduce costs for American families,” the administration said in a press release.

The administration said projects funded by the bill would also have secondary economic benefits by reducing time spent in traffic jams, vehicle wear and tear, and improved access to public transportation.

But critics point out that it will likely take months, if not years, before large-scale infrastructure projects help bring down inflation.

However, inflation, which is currently at a 40-year high of 7.9%, could ease over the next year when the Federal Reserve raises interest rates. A resolution to the Russo-Ukrainian war could also help stabilize wheat and crude oil prices.

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