The U.S. Department of Transportation (“USDOT”) recently announced its new “TIGER II” competitive grant program, a $600 million successor to the popular $1.5 billion TIGER program included in the American Recovery and Reinvestment Act of 2009 (“ARRA”). TIGER II funds must be awarded by September 30, 2012, but there is no deadline for expenditure or project completion, which, unlike the original TIGER program, opens the door to projects not necessarily “shovel ready.” When assessing candidate projects, however, TIGER II will still look for safety, economic competitiveness, livability, sustainability, and state of good repair (the extent to which a project improves the condition of existing infrastructure and minimizes life-cycle costs). In addition, the TIGER II program will give special priority to multi-modal projects that incorporate new technologies or innovative approaches to finance, contracting, project delivery, congestion management, safety, asset management, and long-term operations and maintenance.
Under TIGER II, up to $150 million will be available for projects financed under the Transportation Infrastructure Finance and Innovation Act (“TIFIA”). Under the original TIGER program, applicants could submit a letter of interest for TIFIA consideration with their TIGER grant application. Under TIGER II, however, USDOT can award TIFIA assistance to applicants whether or not they request it – even if USDOT denies the underlying TIGER II grant request. Only $60 million of an authorized $200 million was allocated to TIFIA under the original TIGER program. USDOT’s new authority under TIGER II to award TIFIA assistance in lieu of, or in addition to, grant funding is expected to stimulate greater utilization of the TIFIA program.
TIGER II includes several additional aspects of note:
- Amounts Restrictions: TIGER II grants must be for at least $10 million and cannot exceed $200 million. No state can receive more than 25% of the funds.
- Federal Share Capped at 80%: For most projects, the federal share will be limited to 80%, requiring a 20% local match. This requirement was waived under the original TIGER program.
- Rural Projects: In a significant shift from the original program, TIGER II requires the investment of at least $140 million in rural projects, which are exempt from the 20% local match and the minimum grant size described above. Grants for rural projects must be at least $1 million.
- Planning Grants and USDOT-HUD Coordination: TIGER II can provide up to $35 million in planning grants for activities related to the planning, preparation, or design of certain eligible projects, including transportation corridors or regional transportation systems. USDOT intends to coordinate implementation of these planning grants with HUD’s $40 million Community Planning Challenge Grant program. As with TIFIA funding, under TIGER II, USDOT can provide planning grants even if the applicant does not request such a grant and even if the applicant’s TIGER II grant request is denied.