Now that the House Appropriations Committee has approved its draft Department of Transportation funding bill for 2025, along with the explanatory committee report, we have a full picture of what the numbers in the House bill mean for individual Capital Investment Grant projects waiting for Federal Transit Administration funding.
In the first place, everyone’s tables had to be adjusted because the Mother of All CIG Grants, the Hudson Tunnel Replacement, had its full funding grant agreement (FFGA) signed by all parties on July 9, promising $6.9 billion in CIG funding for that project and moving it from the “future FFGA” section to the “already signed” section of the project list.
Beyond that, the overall size of the fiscal 2025 CIG program under the House bill would be $1.1 billion less than originally requested by the Administration. However, nearly $700 million of that reduction comes from project postponements that the Administration itself might have made, if they were reformulating their budget request using today’s information instead of six months ago.
First, the House bill provides zero funding for the Second Avenue Subway Phase II project in new York City (the Administration had requested $496.8 million). Governor Hochul’s last-minute decision to cancel the new NYC congestion pricing scheme has led to cancelation of some $15 billion in bond issuances that were supposed to be securitized by the annual congestion pricing initiative, and that $15 billion hole in the capital budget is being filled, in part, by the New York MTA indefinitely postponing Second Avenue.
With construction indefinitely on hold, it was an easy call for the House to save almost $500 million by waiting a year to see whether or not New York gets its act back together. In the meantime, we will wait to see if FTA goes ahead and redistributes the prior year appropriations that were already allocated to this project ($150 million if memory serves).
Second, at the last minute, a bipartisan amendment in committee removed the requested $200 million in funding for the first year of the Inglewood (CA) Connector project. It has become more and more doubtful that the project can be completed before the 2028 Olympics open in Los Angeles. Since the project involves tearing up the streets right in front of the stadium where many of the events will be held, the project really can’t go ahead now unless they somehow can get a guarantee of pre-Olympics completion.
Were Democrats in charge of the House, $700 million in easy savings from projects that are not needed this year would be kept in the account and set aside for other CIG projects, but the Republicans lower the overall size of the program instead. They also zero out the requested $264 million for the Florida Northeast Corridor project (because, as today’s update to the CIG dashboard says, the project won’t be ready for a grant agreement until “TBD,” and the committee is insisting that an actual FFGA readiness date in 2024 or 2025 be a prerequisite for funding).
In addition, they cut the requested appropriation for the San Francisco Transbay project in half, from 500 million to $250 million. All in all, the total for “New Starts” is cut by $973 below the budget request, $498 million from already-signed projects and $476 million from pending projects.
The CIG program now funds other kinds of projects (not just full-fledged New Starts), but the Administration did not request any funds for Core Capacity projects this year, nor for the Expedited Project Delivery pilot, because nothing was ready. The Administration asked for $60 million in rainy day money for each type anyway, but the House has declined.
The “small start” category is a bit confusing in the House bill. The House bill reduces or skips the projects requested by the Administration while putting others in their place, and increases the rainy day money for future small starts to $200 million, possibly as a placeholder for something else that emerges later on in the process.