New federal Infrastructure law is one piece of ADOT funding process

New federal Infrastructure law is one piece of ADOT funding process

New dollars are a mix of formula-based funds and competitive grants

January 2022 ushers in a year in which funding for select future Arizona Department of Transportation projects will see an increase over the next five years. A portion of this increase is the result of the recent passage of the federal Infrastructure, Investment, and Jobs Act (IIJA), which uses a mix of funding determined by a formula, and money that will be available only through competitive grants. IIJA replaces the Fixing America’s Surface Transportation Act (FAST). The additional transportation funding is approximately a 20% increase from the existing federal funding the State of Arizona receives.

A Welcome, Complex, and Transparent Program Process

“We welcome additional funding opportunities and the certainty provided by this legislation over the next five years,” ADOT Director John Halikowski said. “Federal funding for transportation is highly complex. We are committed to making this process transparent as part of managing the public’s expectations and will work with our federal partners and other transportation stakeholders to maximize the impact. We will continue to be aggressive and innovative to ensure Arizona takes advantage of every funding source.”

Infrastructure Investment and Jobs Act Funding

IIJA money won’t necessarily begin to flow to projects immediately, and ADOT does not yet know the timing of funding and specific final amounts. For that reason, projects that will utilize the funding cannot yet be determined.

  • Arizona expects to receive through the IIJA an increase of more than $200 million a year over the next five fiscal years between 2022 and 2026.
  • That $200 million per year is part of an overall $5.3 billion (over five years) in what is known as “formula funding” allocated to the state based on an objective formula.
  • ADOT will retain some of that money for projects, while significant IIJA funding will be sent to local government agencies for their transportation projects, such as local street improvements, public transportation, and airports.
  • The exact funding amounts and recipients won’t be known until federal funding notices are provided by federal agencies later in 2022.
  • Competitive funding requires transportation agencies to submit competitive bids for discretionary money available from the federal government. ADOT will rely on added guidance from federal agencies to better understand what opportunities may be available for the state to pursue.
  • Also of note – ADOT’s construction costs have increased 56% over the last five years, which means previously approved funding does not go as far as initially forecasted.

Arizona State Transportation Board/Five Year Program

Projects funded by new money from IIJA will be approved by the Arizona State Transportation Board. ADOT projects require a robust planning and approval process. The overseeing authority is the Board, which approves a new Five Year Program each spring, with annual budgets adjusted to the latest financial forecasts set for each fiscal year. The Board awards construction contracts monitor the status of construction projects and has the exclusive authority to issue revenue bonds for transportation financing. All meetings are open to the public.

Each year, the Board considers various updates to ADOT’s Five Year Transportation Facilities Construction Program. This is essentially the blueprint for upcoming transportation projects. Projects may also require extensive review and approval for environmental, civil rights, and other concerns.

Major Projects Previously Funded and Underway

As 2022 progresses, Arizonans will see significant movement on major transportation projects funded prior to the IIJA. These include a key economic corridor in southern Arizona, as well as improvement projects on both I-17 and I-10:

  • Interstate 10 Broadway Curve Improvement Project.
  • Another potential, future project that has received significant attention is the proposed I-11 corridor, which would span 280 miles between Nogales and Wickenburg. I-11 is in the preliminary study phase, and no funding has been identified for additional, required environmental studies, planning, or other work.
  • Dozens of other projects all around the state.

Project Investment Categories

While new roads attract significant attention, ADOT also is focused on maintaining and operating existing roads and other infrastructure. Similar to how a homeowner does maintenance on their home, ADOT plans upkeep and unplanned work to repair assets all around the state and respond to specific conditions, incidents or events. This link to ADOT’s Project Investment Categories explains the five major categories in simple terms.

Visit ADOT’s website to learn more, and subscribe for updates to receive ongoing information about specific projects.