The Fixing America’s Surface Transportation Act (FAST Act) contains several provisions intended to improve the movement of freight throughout America over the next 30 years. These provisions will have significant impact on the nation’s interstate highway system, freight rail system, its ports and airports, and on the intermodal movement of freight across the country and around the world.

With trucks carrying approximately 70% of all US freight tonnage today, and expected to increase 35% by 2040, the Federal Highway Administration (FHWA). As noted by the U.S. House of Representatives Transportation & Infrastructure (T&I) Committee during a recent roundtable discussion on the impact of the FAST Act’s freight provisions, “absent an increase in capacity, increases in truck and motor vehicle traffic will result in greater congestion across all modes of transportation,” severely affecting the cost of transportation, the productivity of the nation’s workforce, and the nation’s competitive position in an increasingly difficult global economy.

To address this anticipated situation, Congress established two new funding programs: 1) a new formula program to fund freight improvements on the designated national highway freight network; and, 2) a competitive grant program intended to assist states in funding nationally significant highway, bridge, and freight projects.

The formula program is funded at $6.2B over the five-year term of the FAST Act, with $1.1B authorized for fiscal year 2017. According to the House T&I Committee, ”states may use the funds for a variety of projects related to freight movement, including truck-only lanes, electronic screening and credentialing systems for vehicles, and additional capacity to address freight bottlenecks.” The legislation also authorizes up to 10% of the formula funding to be used annually for “freight intermodal or freight rail projects, including projects within the boundaries of public and private freight rail and port facilities and projects that facilitate intermodal operations.”

The competitive grant program, referred to as the FASTLANE program, is directed toward large-scale and multi-jurisdictional projects “that cannot be funded with highway funding apportioned to the states.” Already in FY2016 over $500M worth of projects have received FASTLANE grants. Overall, the program is authorized at $4.5B and at least 25% of the funding is reserved for projects in rural areas, 10% of the funding is reserved for smaller projects (where project costs are less than $100M), and up to $500M over the life of the FAST Act may be used to fund freight rail or intermodal projects if these projects significantly improve freight movements on the National Highway Freight Network, according to the House T&I Committee.

To ensure the funds are applied to the highest priority projects, the FAST Act requires states to develop freight plans for which the U.S. Department of Transportation has just issued guidance: https://www.federalregister.gov/documents/2016/10/14/2016-24862/guidance-on-state-freight-plans-and-state-freight-advisory-committees.

GLDPartners’ expertise and experience can be of great value to help communities, states and other project sponsors in developing their project planning and revising their freight plans.  With success factors such as: the importance to the national freight network, the ability for timely delivery and commercial viability these projects needs carefully developed business planning.

As a related issue, to support our client audiences review the impacts on freight, transportation and economic development, we will be hosting a webinar to review the impact of the November 8^th election on current and future freight and infrastructure initiatives.  There is no cost for this event and it will take place at 2PM EST on November 15^th. Please email Adam Wasserman (adam@gldpartners.com) if you’d like to participate.