By Alan Forsberg, P.E., Retired Blue Earth County Engineer
Editor’s note: A recent workshop organized by the Minnesota Transportation Alliance centered on federal funding for local government transportation projects. Following are the highlights from that event.
Local road and bridge projects in Minnesota are generally funded through some combination of local, state (the local share of the state transportation gas tax fund), federal, and, in some cases, private funds. Obtaining federal funds for local road and bridge projects is often a significant and essential part of that project.
Federal funds can be obtained through three programs: 1) formula funds managed by the Minnesota Department of Transportation (MnDOT) State Aid Office, 2) competitive grants in several programs, administered by MnDOT and awarded by the Federal Highway Administration, and 3) project funds specifically authorized by Congress. The workshop focused on the competitive grant programs.
The competitive grant program was vastly expanded in number of grant types and funds available by the current federal transportation bill, the Infrastructure Investment and Jobs Act (IIJA). Several of the programs were created in response to administration priorities on climate change, sustainability, and equity, including:
- Bridge construction
- Safe streets and roads
- Railroad crossing safety improvements
- Nationally significant multimodal freight/highway projects
- National infrastructure investments, RAISE
- Rural surface transportation
- Reconnecting communities pilot
- And more—such as the upcoming PROTECT (Promoting Resilient Operations for Transformative, Efficient, and Cost-saving Transportation) and low-carbon programs
Lots of money and programs—what to do?
If you have a sound, important project and lack adequate planning staff to review all the programs and develop lengthy, complex grant applications, consider hiring a consultant with the necessary expertise and winning experience.
In the last Minnesota grant cycle, 53 grants of all types were funded for a total of nearly $9.5M, with grants from $200K to $81M. This does not include the large Blatnik Bridge project with a grant of almost $200M. Grants funded by the Minnesota Legislature are available to assist with project planning and grant preparation. In 2023, 25 grants averaging about $30K were awarded to local governments for this purpose.
Grant applications are comprehensive and require considerable time and resources to develop. If a project is not awarded, there is an opportunity to discuss its ranking with the review authorities. However, often these discussions are not with the person rating the project and so may be of limited value.
What are the chances of getting a grant?
It varies greatly with the type of grant. For example, nearly all RAISE grant funds for infrastructure investment are awarded. However, the PROTECT grant has nearly all funds still available. Your local state aid district engineer can provide current information on funds available and the percentage of grant applications awarded for each type of grant. Coordination with your local, state, and federal elected officials and their staff has proven to be helpful in obtaining these grants; attending the Minnesota Transportation Alliance fly-in is a great way to accomplish this.
For tribal nations, a special program exists.
In 2024, Red Lake Nation, in cooperation with MnDOT, was awarded a $24M grant for improvement of a trunk highway within their nation. The Lower Sioux Indian Community submitted a grant in cooperation with Redwood County for improvement of CSAH 2, but it was not awarded. In this case, the partners may learn from this experience and submit again in the next grant cycle. MnDOT may help tribal nations prepare grant applications.
Should you apply for a federal grant?
Here are some things to consider:
- Do you have an economically, environmentally, and socially sound project with good citizen and elected official support? These items will be considered in the application.
- Is your board or council willing to invest the time and funds needed to prepare an application with uncertain results—and willing and able to fund a matching share if it is awarded?
- Do you have the staff resources or are you willing to hire a consultant with the planning expertise needed to develop the application? State planning grants for this work may be available.
- Is there flexibility in your capital improvement plan to advance or delay the project depending on the status of your grant application?
The workshop concluded with an important discussion on future federal funding for transportation projects—including formula, grant, and specially authorized projects.
IIJA required a significant addition of federal general revenue funds to supplement the federal gas tax funds. The next federal transportation funding bill is currently being considered by Congress. In light of the political difficulties of increasing the federal gas tax, the need for additional funding beyond the gas tax is imperative. Because of construction cost inflation, more efficient vehicles, and electric vehicle growth, the current gas tax funds will fall far short of maintaining the existing system, much less cover the expansion of the system to accommodate economic growth.