Most people love infrastructure projects, sometimes the bigger the better. But large capital projects – whether building a new subway or a hospital or an aircraft carrier – take time, and sometimes it’s a lot of time. Based on monthly financial reporting, it appears that the ongoing fiscal year (2024) is the tipping point where the massive funding increases provided by the 2021 infrastructure law for highway and transit spending really started pouring out of the U.S. Treasury.

That law (the Infrastructure Investment and Jobs Act, or IIJA) was enacted in mid-November 2021, six months into fiscal year 2022, and provided a massive increase in budget authority for all sorts of federal infrastructure programs starting in that year. The Highway Trust Fund’s programs received immediate bumps of 24 percent for Highway Account programs and 32 percent for the Mass Transit Accounts, with increases thereafter in the 2 to 3 percent per year range.

Contract authority (a form of budget authority) is just a permission slip for the federal government to enter into a legally binding obligation to pay someone, somewhere, some money someday. These obligations are then delayed because the Trust Fund, unlike almost any other government programs, is subject to an annual ceiling on total obligations in the annual funding appropriations bill (in effect, permission slip #2 needed to exercise permission slip #1). Eventually, contracts are signed, funds are obligated, and projects are built, at the end of which, the U.S. Treasury writes a check or makes a wire transfer to a state or local grant partner to reimburse them for the work done.

This all takes time. Several years, in fact. For example, according to usaspending.gov, two of the three largest checks drawn on the Transit Formula Grants account so far in fiscal 2024 are to New Jersey Transit, for contract authority issued in FY 2021 ($319 million) and FY 2022 ($292 million). In total, outlays from the Trust Fund (the cash reimbursements to states and localities) actually declined in 2022 versus their 2021 levels, because of this time lag (and the tail-end effects of short-term COVID aid displacing long-term capital aid temporarily).

Through the first ten months of the ongoing fiscal year 2024 (October 1, 2023 through July 31, 2024), outlays from the Highway Account of the Trust Fund are up 20 percent above where they were as of the ten-month mark of fiscal year 2021, the pre-IIJA year. And Mass Transit Account outlays are up 49 percent over FY 2021 (though, in that case, the 2021 level suffered much more from COVID aid displacement than did the Highway Account).

In raw terms, these numbers are going to go significantly higher, especially in the Highway Account, where all construction is outdoors and where, accordingly, construction is heaviest and outlays highest in August, September, and October.

The monthly spend rates are shown below graphically (transit spending doesn’t show as much regular seasonality because a much greater share of that money is spent purchasing things like buses and railcars that are made in indoor factories that don’t shut down during cold weather).

(Why do we focus on the Trust Fund, you ask? Because there is no reporting of monthly outlays for most General Fund accounts, that’s why. Usaspending.gov reports all federal spending accounts quarterly, and USDOT reports IIJA stuff cumulatively (FY 2022-2024 all together) every two weeks, but neither of those work for this purpose. The Monthly Treasury Statement is almost worse than useless for most DOT modes – they are still reporting the monthly outlays for Amtrak accounts that Congress stopped funding in 2016, but lump everything else at the Federal Railroad Administration into one big bureau total. Meanwhile, the Federal Highway Administration conveniently updates Table FE-1 every month, which has monthly Trust Fund outlays going back to 2008.)