FAST ACT legislation expected to spur transportation infrastructure improvement

New York — The recently enacted Fixing America’s Surface Transportation (FAST) Act will provide stability and predictability for state and local governments as they undertake improvements to the nation’s transportation infrastructure, according to WSP | Parsons Brinckerhoff.

The FAST Act authorizes $305 billion in funding for federal surface transportation programs for fiscal year (FY) 2016 through FY 2020 with funding for 2016 at $58.2 billion, which is $3.6 billion or 6.6 percent above 2015 levels. The bill ends a long period of flat federal funding and provides for growth at a rate of 3.2 percent from 2015 to 2020.  

“The FAST Act provides modestly enhanced levels of funding to improve highways, bridges, transit systems, and passenger rail, and has broad implications for the nation’s economy and environment,” said Greg Kelly, president  and CEO of the U.S., Central and South America region of WSP | Parsons Brinckerhoff. “When combined with recent state and local increases, overall funding for transportation capital investment in the U.S. will experience real growth for the first time since 2010.”

According to Kelly, the legislation will have a positive and balanced impact on funding levels for all states and across modes of surface transportation. “Higher federal funding levels will enable state departments of transportation and transit agencies to invest in critical new capacity and capital maintenance projects,” he explained. “Just as important, the FAST Act will provide much-needed funding predictability and stability, making large, complex projects more feasible.”

Highlights of the legislation include:

• Ninety-two percent of funding authorized in the FAST Act is “contract authority” and does not require appropriations. The bill does not include any project earmarks but continues and expands the use of competitive grant programs. 
• For the first time, funding for passenger rail ($10.4 billion) is included in the traditionally highway/transit-only bill, including $2.6 billion designated for Amtrak’s Northeast Corridor.
• The law includes two new freight programs which provide $10.8 billion over five years for highway and multimodal (including port and rail) freight projects. 
• The FAST Act includes several new discretionary grant programs, including a freight grant program, a bus and bus facility grant program and three discretionary programs for intercity passenger rail. 

“While establishing a clear course for future infrastructure improvements, the FAST Act does not address the long-term systemic funding issue in which user fee revenues—including the federal gas tax, which has not been increased since 1993—are not keeping pace with spending authorizations,” Mr. Kelly concluded. “By relying on one-time revenue sources, the legislation actually increases the funding gap that will exist when the authorization expires in 2020, meaning a permanent source of adequate funding will be necessary at some point in the not-too-distant future.”