The Bipartisan Infrastructure Act

On Friday, November 5th, the House passed H.R. 3684: The Infrastructure Investment and Jobs Act, more commonly known as the Bipartisan Infrastructure Act (BIF). It had already passed through the Senate with a 69-30 vote before being decided on in the House with a 228-206 vote. The legislation is expected to be on President Biden’s desk this week to be signed into law.
The legislation will reauthorize surface transportation programs for five years and provide funding authorization for energy, water, and broadband infrastructure. It would increase spending on infrastructure by $550 billion over five years and appropriate $445.9 billion in emergency funding. This legislation is a major part of President Biden’s agenda to build stronger infrastructure while providing job opportunities. The White House released the following fact sheet on the bill. A summary report released by Senator Rob Portman can be found here, and a section-by-section released by Senator Joe Manchin can be found here.
While the bill covers a myriad of infrastructural investments, the bill is centered around the reauthorization of surface transportation programs, starting with highways. According to Bloomberg Government, the following measures have been included in the bill relating to highways:

Highways

• Highway Trust Fund: The Highway Trust Fund (HTF), which funds most major highway programs, could become insolvent as soon as the 2022 calendar year, according to estimates from the Congressional Budget Office and the Transportation Department. Funding received from the gasoline tax would transfer $90 billion to the trust fund for highways and $28 billion for mass transit.
• Highway Programs: The bill’s authorization for the main federal-aid highway programs would be $52.5 billion in fiscal 2022, increasing 2% every year and reaching $56.8 billion in fiscal 2026, from the HTF. The five-year total would be $273.2 billion with funding provided as a contract authority. The authorization covers state apportionments for federal highway construction, as well as Surface Transportation Block Grants and other programs.

The measure also would set obligation limits on federal-aid highway and highway safety construction programs, totaling $300.3 billion over the five-year period, limiting the amount of contract authority that can be obligated in a single fiscal year.

• The measure would authorize $3.27 billion over five years from the HTF and $3.27 billion over the same period from the Treasury general fund for bridge investments and would authorize the following amounts through 2026, largely from the HTF:

• $2.19 billion for the Federal Lands Transportation Program.
• $1.5 billion from the Treasury general fund and $275 million from the HTF for Nationally Significant Federal Lands and Tribal Projects.
• $1.49 billion for the Federal Lands Access Program.

• Additional Funding: The measure would authorize the following amounts over five years, mostly from the HTF:

• $4.8 billion for renamed Nationally Significant Multimodal Freight and Highway Projects, also referred to as the Infrastructure for Rebuilding America (INFRA) grant program. An additional $6 billion would be authorized from the Treasury general fund.
• $2.56 billion for Federal Highway Administration (FHWA) administrative expenses.
• $2 billion for the Rural Surface Transportation Grant Program.
• $1.25 billion for the Transportation Infrastructure Finance and Innovation Act (TIFIA) program.
• $570 million to construct ferry boats and terminal facilities.
• $500 million for a pilot program offering grants to explore removing or retrofitting transportation facilities that created community barriers to mobility or economic development.

Climate
Some of the most talked-about provisions in this legislation are those to do with climate. Mitigating climate change was a major talking point of President Biden’s campaign and creating resilient infrastructure was a key part of that. Part of these mitigation tactics includes encouraging a shift from traditional vehicles, powered by sources like gasoline and diesel, to electric vehicles. A tax credit for electric vehicles is included in Build Back Better Act, but the Bipartisan Infrastructure Bill is not without its own provisions towards paving the way for alternative vehicles. It also includes changes to a Trump-era policy that affected the National Environmental Policy Act. Details on what is included can be found below:

• Resilience: The bill would set aside $7.3 billion from the main federal-aid highway allocation and authorize an additional $1.4 billion from the HTF from fiscal 2022 through 2026 as part of a new Promoting Resilient Operations for Transformative, Efficient, and Cost-saving Transportation (PROTECT) program. The program would fund improvements to make infrastructure more resilient to storms and natural disasters.

It also would authorize $500 million over five years to establish Transportation Resilience and Adaptation Centers of Excellence to study how to make transportation more resilient to extreme weather and climate change.
Eligibility for several federal-aid highway programs, including the National Highway Performance Program, would be expanded to include transportation resilience and extreme weather mitigation projects.

• The measure would allocate $6.42 billion over five years from federal-aid highway funds for a new carbon reduction program to reduce transportation-related carbon emissions, according to the funding table.
• The measure would authorize $2.5 billion over five years for grants for electric vehicle charging stations and alternative fuel infrastructure. Half of the funds would be set aside to install alternative fuel stations and infrastructure in publicly accessible locations.
• Additional Programs: The measure would authorize the following amounts from fiscal 2022 through 2026:

• $500 million from the general fund for a Healthy Streets program to deploy cool pavements and expand tree cover.
• $250 million from the HTF for grants to reduce congestion in the busiest metropolitan areas.
• $250 million from the HTF for grants to reduce truck idling and emissions at port facilities.

• Regulatory Processes: The bill would codify elements of the Trump administration’s “one federal decision” policy that required agencies to coordinate reviews and authorization decisions for major infrastructure projects. It also set a goal for completing environmental reviews within two years.
• User Fees: The measure would set aside $50 million over five years from highway research and development funds for a new pilot program to explore the use of a national motor vehicle per-mile user fee to bolster the HTF.

The bill also would set aside $75 million over five years to reauthorize and expand a separate program offering grants to states for pilot projects to test road usage fees and other alternative revenue mechanisms.

• Other Provisions: The measure also would:

• Require the FHWA to develop a tool to help transportation authorities identify and respond to cyber incidents.
• Stipulate that at least 10% of the bill’s funds have to flow through small businesses owned by socially and economically disadvantaged individuals, though the Transportation Department could waive the requirement.
• Authorize grant recipients for transportation projects to implement a local, geographical, or economic hiring preference for construction workers. Such preferences couldn’t be construed to “unduly limit competition.”
• Modify eligibility rules for Surface Transportation Block Grants to include wildlife crossing structures, electric vehicle charging infrastructure, intelligent transportation technologies, and projects that facilitate intermodal connections with emerging technologies such as magnetic levitation and hyperloop.
• Extend eligibility for TIFIA loans to airport projects and economic development projects related to rail stations, among other program changes.
• Make several changes to the INFRA grant program, including directing at least 15% of funds, instead of 10%, toward smaller projects, and establishing set-asides for projects with a higher nonfederal match or that would address certain critical freight needs.
• Require the Transportation Department to provide notice and opportunity for comment before waiving Buy America requirements.
• Direct public entities in public-private partnerships that cost $100 million or more to review the private entity’s compliance with the terms of their agreement within three years of when the project opens to traffic.
• Allow the Transportation Department to use alternative contracting methods—such as bundling or design-build contracting—on behalf of federal land management agencies and tribal governments.

• The measure also would provide $47.3 billion in supplemental emergency appropriations for highway infrastructure programs from the general fund. Amounts would be provided from fiscal 2022 through 2026, including totals of:
  • $27.5 billion to repair and replace bridges and a separate $9.24 billion for the Bridge Investment Program.
  • $5 billion for states to deploy electric vehicle charging infrastructure and a data-sharing network. The measure would establish a joint office for the Energy and Transportation departments to coordinate their work on EV infrastructure, which would include new installation and interoperability standards.
  • $3.2 billion for renamed Nationally Significant Multimodal Freight and Highway Projects, currently referred to as INFRA grants.
  • $500 million for a pilot program to remove transportation barriers in communities.

Rail
This bill authorizes close to $50 billion for rail infrastructure with $15 billion of that funding used from 2022 through 2026 for Rail Improvement Grants. It also includes a foreign freight car ban stating that freight cars manufactured one year following enactment could only operate in the U.S. if:

• The manufacturer isn’t owned or controlled by a foreign government of concern.
• Sensitive technology on the freight car doesn’t originate from a state-owned company.
• None of the content of the freight car originates from a country of concern or a company that has violated U.S. intellectual property rights.

Hazardous Materials
The measure authorizes $345 million over five years for the Pipeline and Hazardous Materials Safety Administration’s hazardous material safety programs. It also would reauthorize spending from the Hazardous Materials Emergency Preparedness Fund for the same period. It would also formally authorize the agency’s Assistance for Local Emergency Response Training (ALERT) grant program. Emergency appropriations for hazardous materials include:

• $5 billion for grants to implement “Vision Zero” plans to prevent transportation-related fatalities and serious injuries.
• $1 billion for the Pipeline and Hazardous Materials Safety Administration to upgrade natural gas distribution pipelines.
• $750 million for NHTSA crash data and $548 million for its vehicle safety and behavioral research programs.
• $622.5 million for FMCSA motor carrier safety grants.

Research and Innovation
The measure includes a series of research and innovation-based policies including an “Advanced Research Projects Agency-Infrastructure” (ARPA-I) would be established within the Transportation Department and would authorize “such sums as are necessary” for the program. The measure would also authorize a total of $500 million over for five years for the Strengthening Mobility and Revolutionizing Transportation (SMART) Grant Program and would establish a center within the Transportation Department to improve interagency coordination and expedite projects related to permits and environmental reviews for major transportation infrastructure projects.
Aviation
In terms of aviation, BIF would provide supplemental emergency appropriations for aviation programs for fiscal 2022 through 2026, including:

• $15 billion in formula funding for Airport Improvement Program projects.
• $5 billion for airport terminal development projects.
• $5 billion for Federal Aviation Administration facilities and equipment, including FAA-owned contract towers.

Multimodal and freight programs
Multimodal and freight programs would authorize $10 billion for grants supporting infrastructure projects with national or regional significance and $7.5 billion for projects with local or regional significance or fiscal 2022 through 2026. It would also establish and authorize “such sums as are necessary” for an Office of Multimodal Freight Infrastructure and Policy at the Transportation Department, headed by a presidentially appointed assistant secretary.
Water infrastructure
Water infrastructure is covered through both drinking water and clean water provisions as part of this legislation. The bill would authorize over $15 billion through fiscal 2026 for drinking water infrastructure for the Drinking Water State Revolving Funds Program, Lead Reduction grant programs, and would extend the authorization for compliance assistance grants to public water systems in small and disadvantaged communities. It would authorize annual grants for leak detection, repair, and monitoring in small public and nonprofit water systems. For clean water infrastructure, over $16 billion would be authorized for the Clean Water State Revolving Funds program, Water Infrastructure Finance and Innovation Act, grants to address sewer overflows, and research grants to address water pollution.
Energy infrastructure
Energy infrastructure plays a major role in this infrastructure package as a shift to renewable energy and achieving net zero emissions are part of the foundation of President Biden’s agenda. Energy infrastructure has received funding for the following through BIF:

• Electric grid security would receive around $24 billion in authorized funds for resilience grants, grid programs, and other grid provisions. The resilience grants would be authorized for $5 billion over five years for grants to stakeholders in the electricity generation and distribution sector to supplement their own efforts to improve resiliency to disruptive events including natural disasters. Grid programs include funding for: competitively awarded financial assistance to utilities to demonstrate new approaches to improve grid resilience; a program to award grants to match investments in smart grid technologies; and improve resilience and environmental protection in rural areas.
• Energy cybersecurity provisions would authorize over $500 million through fiscal 2026 for competitive grants, cooperative agreements, and technical assistance to small, municipal, and rural utilities to prevent and respond to cyber threats as well as to develop cybersecurity applications for the energy sector to identify and mitigate vulnerabilities and advance the security of devices and third-party systems.
• Clean energy supply chains would be granted $3 billion over five years through the Energy Department’s Office of Fossil Energy for demonstration projects to process battery materials and for constructing or retrofitting processing facilities. An additional $3 billion over five years would be authorized for Office of Energy Efficiency and Renewable Energy grants for similar activities related to manufacturing and recycling batteries.
• Carbon capture infrastructure provisions would authorize $3.5 billion over five years for Energy Department financial support for projects that help develop four regional hubs to capture carbon dioxide from the atmosphere and transport, store, and use it. The measure would create a “carbon dioxide transportation infrastructure finance and innovation” or CIFIA program to leverage federal funding to make loan guarantees and secured loans supporting large projects for infrastructure to transport carbon dioxide. It would authorize $600 million per year in fiscal 2022 and 2023 and $300 million each year afterward through fiscal 2026.
• Other fuels infrastructure in this measure would authorize $8 billion over five years to support hydrogen fuel production from different sources, use of hydrogen for electricity and industrial processes, and hydrogen fuel transportation. The measure would also authorize $1 billion over five years for a research, demonstration, and commercialization program aimed at reducing the cost of hydrogen produced from electrolysis to less than $2 per kilogram of hydrogen by 2026.
• Energy efficiency in BIF would authorize $250 million for fiscal 2022 to create an Energy Efficiency Revolving Loan Fund Capitalization Grant Program for states to conduct energy audits and energy upgrades or retrofit projects. The measure would also authorize $500 million over five years for a grant program for school improvements that reduce energy costs, improve health and indoor air quality, or involve renewable energy technologies or alternative fueled vehicles.
• Use of Covid-19 funds would be allowed by states to satisfy nonfederal matching requirements for Bureau of Reclamation water projects.

Broadband and Cybersecurity
Broadband and cybersecurity have become a fundamental part of what we define as infrastructure as technology has become an essential part of most Americans’ lives. Broadband provisions in BIF include:

• Connectivity grants: The bill would authorize $42.5 billion for a Broadband Equity, Access, and Deployment Program within the Commerce Department that would provide grants to increase connectivity to underserved and high-cost areas. The measure would provide a minimum of $100 million to each state, Washington, D.C., and certain territories. Grantees could provide subgrants for service projects, connecting “anchor institutions” such as a library or school, providing internet-capable devices, or other projects that further the goal of increasing connectivity.
• Digital equity grants: The measure would create a State Digital Equity Capacity Grant Program and authorize $60 million for grants to states to develop digital equity plans and $1.44 billion from 2022 through 2026 for capacity grants to states to implement their plans. The measure would also authorize $1.25 billion over five years for a Digital Equity Competitive Grant Program to support state, local, and tribal governments, as well as nonprofits or private entities that aren’t responsible for carrying out the state program.
• “Middle Mile” grants: The measure would authorize $1 billion over five years for grants to support the construction, improvement, or acquisition of “middle-mile” projects that connect network infrastructure to limit single points of failure.
• Affordable internet program: The measure would direct the Federal Communications Commission to issue rules to extend the emergency broadband benefit enacted under the fiscal 2021 omnibus spending law (PL 116-260).
• Digital discrimination: The FCC would have to adopt rules to facilitate equal access to broadband internet services within two years of the measure’s enactment. The rules would bar discrimination based on an area’s income level, the predominant race or ethnic groups in an area, and any other factors deemed relevant by the commission.
• Emergency appropriations for broadband programs over 5 years include:
  • $42.5 billion for National Telecommunications and Information Administration (NTIA) grants to states, territories, and the District of Columbia for broadband deployment.
  • $14.2 billion for a renamed Affordable Connectivity Program, through which the Federal Communications Commission reimburses broadband service providers for discounts to eligible households. The maximum monthly subsidy would be reduced to $30 from $50.
  • $2.75 billion for NTIA grant programs to promote digital inclusion and equity for underserved communities.
  • $2 billion for rural broadband loans and grants through the Agriculture Department.
  • $2 billion for the Tribal Broadband Connectivity Program.
  • $1 billion for NTIA grants to construct “middle-mile” broadband infrastructure.

Cybersecurity provisions in BIF include:

• Cyber Response and Recovery Fund: The measure would authorize $140 million from fiscal 2022 through 2028, and appropriate $100 million, to create a Cyber Response and Recovery Fund.
• Significant Cybersecurity Incidents: The Homeland Security secretary could make a declaration in the event of a significant cyber incident or an imminent incident, or when available resources are insufficient for an effective response.
• Cybersecurity Grants: The measure would authorize $1 billion from fiscal 2022 through 2025 to create a grant program to help states and tribal governments address cybersecurity threats.

Domestic Content Provisions
Included in this package are Domestic Content Provisions, most importantly the Buy America Preference which would require the iron, steel, manufactured products, and construction materials used in infrastructure projects to be produced in the U.S. Cement and aggregates such as stone, sand, and gravel, wouldn’t be covered. The bill would permit waivers to the “Buy America” preference, including if there were insufficient supplies or meeting the requirement would increase costs by more than 25%. It would also direct OMB to establish the “Made in America Office” to enforce compliance with domestic content statutes, review waiver requests, review reciprocal defense agreements with foreign governments, and report the percentage of federal procurements made in the U.S.
The measure would authorize $5 billion over five years for the Environmental Protection Agency to award grants and rebates to replace school buses with zero-emission buses or buses that the EPA certifies reduces emissions and use alternative fuels. It would authorize $1 billion for the Transportation Department to establish a program to provide funding to states to ensure basic essential ferry service in rural areas and $250 million for the department to establish a pilot program to provide grants to purchase electric or low-emission ferries.
Additional Emergency Appropriation
BIF provides the following emergency appropriations:

• Army Corps: The measure would provide $11.6 billion for Army Corps construction, including $2.55 billion for coastal and hurricane-related projects and $2.5 billion for inland waterway projects. The Corps would receive another $4 billion for operations and maintenance.
• FEMA: The measure would provide the following amounts for programs run by the Federal Emergency Management Agency:
  • $3.5 billion for the National Flood Insurance Fund for flood mitigation assistance.
  • $2.23 billion for federal assistance programs, including $1 billion for grants to help state, local, tribal, and territorial governments upgrade their cybersecurity and critical infrastructure.
  • $1 billion for the Disaster Relief Fund to be used for pre-disaster hazard mitigation assistance under FEMA’s renamed Building Resilient Infrastructure and Communities program.
• Forests and Wildfires: The Agriculture Department’s U.S. Forest Service would receive $2.85 billion for the national forest system and $1.53 billion for state and private forestry. The Interior Department would receive $1.46 billion for wildland fire management.
• NOAA: The measure would provide $2.61 billion to the National Oceanic and Atmospheric Administration for grants, mapping and forecasting, and other activities.
• MARAD: The measure would provide $2.25 billion for the Maritime Administration’s port infrastructure development program.

 
We understand that this is a substantial piece of legislation with a multitude of provisions. We invite you to reach out to us should you have any difficulties or need any further information relating to this legislation. Please contact Jeffrey.Brooks@arlaw.com or Kate.Reitz@arlaw.com for any questions or concerns you may have.