On June 3rd 2026, FHWA Administrator Sean McMaster appeared before the Senate Environment and Public Works Committee to outline the administration’s FY2027 budget request and provide updates on the administration’s actions. With much of the FHWA’s budget contingent on contract authority from the still-pending multi-year reauthorization package, members took the opportunity to question McMaster on the backlog of pending obligations for announced projects, on priorities for reauthorization and the use of still-unobligated IIJA funds, and about the prospects for permitting reform. 

FHWA Appropriations and IIJA Funds 

McMaster pledged a “back to basics” approach in the FY2027 budget, claiming the Trump administration was focused on investing in bridges and roadways, on which 91% of US travel occurs. He characterized congestion as a critical problem to the nation and highlighted state-federal partnerships under the Freedom to Drive Initiative. He additionally emphasized departmental efforts to streamline review processes and accelerate project delivery, including support of innovative technologies. Much of McMaster’s opening statement was dedicated to roadway safety programs, citing a 6.7% decrease in annual traffic fatalities in 2025 and highlighting initiatives including investments under the SAFE ROADS program, grants for Work Zone Management Program trainings, and nationwide Traffic Incident Management courses provided to first responders and towing personnel. 

Chairman Shelley Moore Capito (R-WV) commended McMaster’s commitment to rebuilding staff capacity within FHWA division offices to provide states technical support while finding areas for efficiency in scaling back federal administrative oversight. At the same time, she questioned the administration’s continual struggle to award funds to projects, expressing concern that high amounts of expiring unobligated funds were being reassigned to state formula funds, creating an “end of the year scramble where lower priority investment may be carried out to avoid a lapse”. McMaster noted that the FHWA had provided state DOTs with estimated amounts of additional formula funds as early as eight months in advance of the ‘August redistribution’ of lapsing funds to allow for better project preparation. Senator Capito cited lapsing unobligated funds as a key reason for reapportionment of IIJA advance funds within annual appropriations. 

Ranking Minority Member Sheldon Whitehouse (D-RI) raised concerns with the DOT’s prioritization of highway funding over other modes within its requested budget, voicing frustration with executive branch attempts to freeze already-obligated rail and transit projects. He characterized bike and pedestrian infrastructure funding as vital to achieving the administration’s stated ‘Make America Healthy Again’ agenda. He also expressed discontent with the freezing and reapportionment of National Electric Vehicle Infrastructure program funds, claiming it was hurting drivers at a time of high gas prices. Senator Whitehouse urged the administration to fully implement the billions of dollars in remaining IIJA funds. 

Announced Project Backlogs and Obligation of Funds 

The hearing’s clearest tensions emerged on the backlog of previously announced projects that have yet to receive obligated funding or have been otherwise stalled in FHWA approval processes. In his opening statement, McMaster attributed lingering delays to the 3,200 competitive grants inherited from the Biden administration that were announced without funding obligation. He claimed that the administration was working diligently to ease the backlog, with the FHWA already having obligated funds for over 60% of its announced grant awards and having completed the departmental review process for 90-95% of pending projects to determine next steps. 

Senator Whitehouse voiced serious concerns with the lack of action on remaining announced yet unobligated programs and perceived unresponsiveness from the administration. He highlighted the Charging and Fueling Infrastructure (CFI) grant program, through which 130 grants had already been announced but all left unobligated by the Trump administration. Senator Whitehouse voiced particular frustration over the FHWA leaving his request for project timelines for the 130 announced grants unfulfilled, claiming that the grants were still awaiting review by the Secretary. Given the proposed rescission of CFI funds within the DOT’s requested 2027 budget, Senator Whitehouse suggested that these delays in project review amounted to deliberate and potentially unlawful stalling by the FHWA, postponing obligation until new legislation could repeal unspent program funds.  

Senator Alex Padilla (D-CA) likewise urged the FHWA to meet its stated goal to accelerate project delivery, citing a number of projects already announced, some of which already had funding contractually obligated, that had nevertheless been stalled in later stages of review or the actual distribution of federal funds. He urged immediate action and greater transparency on the progress of pending projects. 

Senator Capito sought the rationale for amendments to Notice of Funding Opportunities (NOFOs) under two already-awarded discretionary grant programs – the Scenic Byways Program and Bridge Investment Program – claiming state DOTs with already-awarded grants were being forced to reapply. McMaster justified this process as necessary to remove DEI and green requirements and committed the FHWA to issuing funds prior to expiration. 

Senator Angela Alsobrooks (D-MD) raised concerns regarding certified contractors under the Disadvantaged Business Enterprise Program requiring recertification due to changed regulations, creating delays for projects and potentially limiting business opportunities for underrepresented groups. McMaster again justified this decision as necessary to eliminate DEI and the consideration of race and gender in the procurement process, in line with recent SCOTUS rulings. 

Permitting Reform 

McMaster noted significant DOT progress in expanding the NEPA Assignment Program, which allows agreements to shift duplicative environmental review responsibilities from the federal government to the states. Nine states are current participants, with seven more indicating interest. He commended the Department for simplifying NOFO language, cutting word count in half and reducing complexity, and standardizing application templates, in addition to over 50 deregulatory actions. He claimed that the environmental review process had been reduced by an average of six months compared to the Biden administration in response to these changes. McMaster additionally referenced continued departmental rulemaking processes to streamline the NEPA process. 

In his opening statement, Senator Whitehouse shared that progress has been made in negotiations with Senator Capito on legislative permitting reform, a priority for members of both parties. However, he claimed that executive branch actions had also impeded progress and forced a pause of negotiations. Stop work orders affecting key clean energy projects – at first coming from the Department of Interior, but more recently emerging from the Department of Defense, citing ambiguous national security risks of wind energy – had diluted trust of Democratic members that any legislative agreement would be faithfully executed. Senator Whitehouse claimed that unless the Trump administration allowed projects to continue in line with statutorily defined processes, he would be unable to assemble enough Democratic votes to pass this bipartisan legislative priority. 

Notably, Senator Rodger Wicker (R-MS) interjected that, as Chairman of the Senate Armed Services committee, he shared Senator Whitehouse’s concerns and was already in talks with relevant DOD officials. The two senators left the hearing to privately confer on the issue, suggesting potential progress in working to resolve the source of legislative gridlock. 

Senator Kevin Cramer (R-ND) offered an alternative outlook, suggesting that presidents routinely interfered with projects advanced by the opposite party and that this should serve as a reason for advancing permitting reform legislation rather than delaying legislative negotiations. By solidifying reforms in statute, Congress could limit executive discretion and ensure projects successfully advance regardless of the party in power. 

Reauthorization Priorities 

Committee members shed some light on the Senate’s role in the 2026 reauthorization process. Senator Capito provided three principles that would guide her approach to crafting reauthorization legislation: first, improving infrastructure safety and reliability; second, reforming and modernizing federal policies to increase efficiency; and third, addressing the variety of surface transportation needs across different states. She emphasized a focus on “flexible, predictable formula funds to the states” to allow state and local authorities the certainty to deliver projects on-time and on-budget and ensure all funds are properly allocated. 

The House’s recently marked up BUILD America 250 Act was mentioned several times by Committee members. Senator Pete Ricketts (R-NE) suggested that the Environment and Public Works Committee was currently at work on drafting its own version of the surface transportation reauthorization bill, running behind the release of House Transportation and Infrastructure Committee legislation in late May. 

Senator Whitehouse plainly stated that he didn’t love the House’s surface transportation bill but acknowledged the bipartisan efforts behind it. He emphasized two conditions necessary to passing any reauthorization legislation within this congress: first, the full “implementation of the law”, including statutorily funded grant programs that the administration may oppose; and second, collaboration between the four relevant Senate committees and chamber leadership. He stressed that support for multimodal investment and recognition of climate and energy costs would be critical to winning Democratic support. 

Tensions emerged on the issue of EV and hybrid vehicle registration fees included within the House reauthorization package. Senator Cramer voiced support for the fees as necessary, though not sufficient, to address the Highway Trust Fund’s solvency issues and in compliance with the principle that all users should support the roadway system. Senator Padilla agreed with this argument in principle yet claimed that current legislation would disproportionately punish EV owners, especially as lawmakers contemplate providing additional gas tax relief. 

Addressing apportionment, Senator John Curtis (R-UT) raised concerns with the use of static population figures as a central determinant of formula funding. He suggested that fast-growing states would be unable to fund infrastructure necessary to accommodate rapid growth in demand and indicated interest in revisiting formula factors during the reauthorization process.  

Senator Mark Kelly (D-AZ) voiced interest in supporting community control by suballocating funds directly to Regional Transportation Planning Organizations, the rural equivalent of Metropolitan Planning Organizations, which have not previously received direct federal funding. Senators Kelly and Dan Sullivan (R-AK) both voiced support for continued investment in programs serving tribal communities.