Demand for DOT infrastructure grants exceeds supply
Competition is fierce for $1.5 billion in discretionary transportation grants from the U.S. economic stimulus program but there is not nearly enough money to satisfy demand.
The Department of Transportation announced Friday that it received almost 1,400 applications from cities, states, metropolitan planning organizations, port authorities, transit agencies and other governmental entities seeking a combined $57 billion in project funding.
The TIGER (Transportation Investment Generating Economic Recovery) grants were included in this year's American Recovery and Reinvestment Act to reward projects based on economic, safety and environmental merit rather than standard formulas for spreading federal revenue to states. The Recovery Act provides more than $40 billion to infrastructure projects through such traditional means. The TIGER grants are intended to fund innovative surface transportation projects of national, regional or metropolitan significance, especially ones that are intermodal and multijurisdictional in nature.
More than half of the TIGER applications are for highway or bridge projects, with the rest of the applications focusing on transit, railroad, port infrastructure, multimodal or other investments, according to the DOT. It received 96 applications from ports, or 7 percent of the total, seeking a total of $3.38 billion. There were 125 rail-related applications totaling $5.6 billion.
Port Manatee, for example, said it requested $36 million in federal grants to expand its container-handling infrastructure to support short-sea shipping between the Florida port and the Port of Brownsville, Texas. The project includes building a terminal, extending an existing berth, adding a mobile harbor crane for loading and unloading containers on barges, and purchasing two switch engine locomotives to replace obsolete equipment.
Applications were due Sept. 15 and the department said it plans to announce award winners by January. Projects will be evaluated based on factors such as fuel and travel time savings, carbon emission reductions, and economic and public health benefits. Applicants with projects in excess of $100 million had to submit detailed cost-benefit analyses, while those with projects of $20 million to $100 million had to estimate public benefits. The DOT said it will give more weight to long-term factors such as repairing existing infrastructure, economic competitiveness, enhancing livable communities, sustainability, safety and job creation, and less weight to innovation and partnerships. The maximum potential grant size is $300 million.
Allocating money based on anticipated project performance is supported by many transportation experts and reformers on Capitol Hill. Businesses, engineers, public transportation advocates and other groups have articulated a critical need to invest heavily in transportation infrastructure because years of neglect have left the system in a state of disrepair and unable to handle growing traffic volumes. Congress is debating whether to approve an 18-month extension of existing surface transportation programs or create a new multiyear spending plan that identifies additional revenue sources for the Highway Trust Fund and restructures transportation policy.
A major complaint with the current process is that a large amount of funds appropriated for transportation goes to lawmakers' pet projects that are deemed important at the local level but don't improve the overall connectivity of regional and national transportation corridors over which the bulk of people and freight move. The rest of the money is distributed through formulas designed to share gas tax receipts among states at a fairly even level without rewarding state departments of transportation for prioritizing projects or using innovative construction and contracting techniques.
The TIGER grants could serve as a blueprint for the transportation reauthorization bill to better target money to worthy projects, some transportation infrastructure supporters say.
Walter Kemmsies, chief economist at marine engineering firm Moffat & Nichol, said the Obama administration should consider tapping the Troubled Asset Relief Fund to increase the size of the TIGER grant program, and start improving highways, ports, intermodal connections and other physical assets that are key to U.S. economic competitiveness. As the banks repay the TARP funds some of that money could be put in to TIGER projects, he elaborated following a presentation at the Council of Supply Chain Management Professionals in Chicago last week.
TARP is a $700 billion program used last year to bail out hundreds of banks, and some insurance companies and automakers during the financial crisis.
The Senate's 2010 Transportation appropriation bill includes a $1.1 billion grant program that is similar in concept to the TIGER program. The Bipartisan Policy Center has recommended that a quarter of all DOT grants to states be available for expansion projects based on a competitive grant process, including a specific pool of money for freight transportation and road connections to ports, airports and rail hubs.
The DOT said it would post a complete list of TIGER applications on its Web site next week. A summary is available here. ' Eric Kulisch