Indiana is set to receive, at minimum, nearly $8 billion of the $550 billion passed by Congress in the 2021 Infrastructure Investment and JOBS Act (IIJA) earmarked for “new investments” in the country’s infrastructure.
That presents a critical question: is the state prepared to receive and deploy these funds within the requisite five-year period?
The Chamber’s Infrastructure Policy Committee heard from state officials last Wednesday who provided insight as to measures being taken to do just that – specifically, Cris Johnston, director of the Office of Management and Budget; Chris Creighton, chief of staff at Indiana Department of Transportation; and Jodi Golden, state infrastructure administrator. The committee also heard from deputy assistant secretary at the U.S. Department of Transportation, Charles Small, as well as Danielle McGrath, president of the Indiana Energy Association.
A few themes emerged from Wednesday’s discussion: workforce, compliance, supply chain concerns and state/local cooperation.
Workforce. Eight billion dollars is a lot of money to spend in five years. The good news is that Indiana has been investing in major infrastructure improvements regularly since passing landmark legislation in 2017. As such, ramping up workers will be less challenging for Indiana than other states.
Compliance. The IIJA imposes numerous requirements on state and local governments with respect to the way in which it spends federal money (e.g., union labor and “Buy America” sourcing for raw materials). The strings involved can present challenges for those tasked with developing and implementing investment strategies. Johnston cited “administrative oversight” as a top priority to ensure Indiana avoids running afoul of the rules set by Congress.
Supply chain concerns. The “domestic content” provisions in the IIJA require that certain goods purchased with federal funds be manufactured primarily in the U.S. – specifically those used in construction. In other words, every state and locality that receives funds from the IIJA will be competing for a lot of the same products from the same domestic suppliers. Waivers are permitted under the IIJA in certain circumstances. For example, “Buy America” requirements may be deemed inconsistent with public interest. This was cited as a key challenge by the panel.
State/local cooperation. In addition to the nearly $8 billion in guaranteed funding, the state and its communities can compete for their share of another $75 billion made available for “competitive bidding.” The committee agreed that those most likely to win these grants will be agencies with sufficient resources. The state has a role in ensuring locals avoid competing against themselves for the same dollars to address overlapping infrastructure concerns.
In short, we learned a lot about where the state stands to receive and deploy IIJA dollars. Maybe Indiana is not fully prepared to receive these dollars today – but there is no doubt that officials are improving the state’s readiness for later this year when the first tranche arrives.
