GoRail: What IIJA Means for Railroads

Written by William C. Vantuono, Editor-in-Chief
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Russ McGurk

On Nov. 15, President Joe Biden signed the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA), described by rail advocacy organization GoRail as “a momentous, bipartisan bill for fixing and improving U.S. roads, bridges, waterways, airports and other infrastructure systems, and reauthorizing surface transportation programs for the next five years.”

The “other infrastructure systems” do include rail. That amount is only a fraction of what the highway lobby gets, but it is still significant. “Policymakers who crafted the IIJA did not forget railroads, securing funding opportunities and balanced policies that underscore the critical role of rail in moving both people and freight, while addressing supply chain challenges,” notes GoRail President Russ McGurk. Here’s his summary, “five ways the bill impacts America’s railroads and rail-served communities.”

1. “Intercity passenger rail will get more money than ever before: The IIJA delivers big for passenger rail, providing $66 billion to Amtrak to improve and expand service. This is the largest investment ever for the nation’s intercity passenger railroad, which previously had an annual budget of $2 billion. This funding will help Amtrak tackle projects along the Northeast Corridor, for example the Hudson Tunnel Project (Gateway), as well as its 15-year vision for extending service to 160 additional communities.

2. “A dedicated grant program will alleviate grade crossing challenges: While education can encourage safer behavior around railroad tracks, the safest grade crossing is one that doesn’t exist. After all, 95% of all rail-related deaths involve a person or vehicle on the tracks. That’s why the IIJA’s infusion of $600 million per year for eliminating or separating these areas where railroads and motorists interact is so important. The new program, spearheaded by Sens. Maria Cantwell (D-Wash.), Chair of the Senate Committee on Commerce, Science, and Transportation, and Roy Blunt (R-Mo.), is on top of expanded funding ($245 million) for the Section 130 program to enhance safety at crossings. These investments will not only support safety, but also increase freight mobility and reduce wait times for drivers. Freight railroads have long advocated for such funding, which will be available to states, cities and [Native American] tribes.

3. “Rail and multimodal projects get a major boost: Several existing programs providing discretionary grants for rail and multimodal projects will get more money than ever before—an average of $5.5 billion annually together. This includes:

  • CRISI: Established in 2017 by the FAST Act, the Consolidated Rail Infrastructure and Safety Improvements (CRISI) grant program is for projects that improve the safety, efficiency, and reliability of freight and intercity passenger service. It’s the only federal funding that short line railroads are eligible to directly apply for and it’s particularly helpful for them in tackling projects like track rehabilitation, repairing or replacing aging bridges, improving grade crossings, or eliminating bottlenecks. The IIJA allocates $1 billion annually for the program, up from $360 million in FY21, and also expands eligibility to include projects that foster rail innovation, reduce emissions, or improve pedestrian safety along railroad tracks.
  • INFRAThe Infrastructure for Rebuilding America (INFRA) program, which will receive $1.64 billion for FY22-24 under the IIJA, is designed to fund highway and rail projects of national significance that support jobs and local economies. This year for the first time ever, the U.S. Department of Transportation (DOT) announced project proposals would also be evaluated by how they addressed climate change, environmental justice and racial equity.
  • RAISEFormerly known as TIGER or BUILD, the Rebuilding American Infrastructure with Sustainability and Equity (RAISE) program is one of the few DOT discretionary programs for which regional and local governments can directly compete for multimodal transportation funding. It will receive $1.5 billion annually from the IIJA, funding projects judged by their impact on safety, sustainability, quality of life, economic competitiveness, state of good repair, innovation, and partnership.

4. “New research could help railroads reduce their carbon footprint even further: Crosscutting throughout the IIJA is a focus on innovation. One aspect of this is the establishment of a new Office of Clean Energy Demonstrations at the Department of Energy (DOE) that will oversee $21 billion in projects, including those related to emissions reduction in long-distance transportation. Several programs supporting alternative fuel research are also available to freight railroads.While freight railroads are already the most sustainable way to move freight over land, cutting down on emissions 75% over trucks, they continually seek ways to improve fuel efficiency and improve on their record. This funding recognizes the innovation occurring within the sector and the role railroads will play in moving goods more sustainably.

5. “Greenlit studies explore rightsizing highway costs for commercial vehicles: Fuel taxes are falling further behind as vehicles become more efficient and EVs become more prevalent—and two studies approved by the IIJA will explore this area. One is the first Highway Cost Allocation Study since 1997, which will help Congress make sure different highway users cover their share of infrastructure damage. The other study is a pilot program for demonstrating a national vehicle per-mile traveled (VMT) user fee, including for commercial motor vehicles, to restore and maintain long-term solvency of the Highway Trust Fund. Such a formula would not only ‘lead to more equitable and efficient use of roadways,’ according to the Government Accountability Office, it could also right-size the underpayment of large trucks, which currently cover only 80% of the damage they cause. When trucks effectively receive a subsidy to use highways, it makes it harder for self-funded railroads to compete, ultimately diverting freight away from railroads.

“As the infrastructure bill is implemented, and funding opportunities become available for these programs and others, GoRail will continue to provide information and analysis on what this means for rail advocates in communities across the country.”

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