Infrastructure Investment and Jobs Act - Summary of Key Programs and Provisions - Akin Gump Strauss ...
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Infrastructure Investment and Jobs Act Summary of Key Programs and Provisions
Introduction ..........................................................................................2 Department of Transportation .....................................................2 Energy Programs .............................................................................10 Environmental Protection Agency ..........................................17 Broadband ...........................................................................................21 Buy America and Buy American Domestic Content Requirements ....................................................................................24 Cybersecurity ....................................................................................26 Moratorium on HHS Implementation of the “Rebate Rule” ......................................................................................28 The Recovering Excessive Funds for Unused and Needless Drugs (REFUND) Act ..................................................29 Revenue Measures .........................................................................29
Introduction
The Infrastructure Investment and Jobs Act (the “bill”) On August 10, the Senate approved the bill with
is historic and transformational legislation that, when it bipartisan support. While the timeline for approval in
becomes law, will make available $1.2 trillion in funding the House is unclear, all indicators suggest that the
for infrastructure programs across the transportation, House will pass the bill. To that end, we are pleased
energy and water sectors, through a combination of to provide an analysis of the bill with an emphasis on
grants, loans and tax incentives. Of the $1.2 trillion new programs and policies.
in spending, $550 billion is new federal spending not
previously authorized. The bill also reauthorizes the
highway, public transportation and rail programs for
five years.
Department of Transportation1
fuel charging infrastructure, resilient infrastructure
and projects in low-income neighborhoods. We also
note new programs and important changes to existing
programs, and that many grant programs have a
nonfederal match requirement.
• Nationally Significant Freight and Highway
Projects program (also known as “INFRA”).
$8 billion is available for a program authorized in
current law that funds highway and rail projects of
regional and national significance. Of this funding,
$4.8 billion is made available in the base bill text
Department of Transportation1 and a supplemental $3.2 billion is appropriated.
Key Highway Programs The bill also makes modest changes to current law
such as providing pre-award authority to incur costs
The bill makes available $219.6 billion over five years
after award and before the U.S. Department of
for the Federal-Aid Highway Program and $110 billion
Transportation (DOT) enters into a grant agreement
in supplemental funds for roads, bridges and major
with a project sponsor, clarifying eligibility of
projects. Many of the programs are existing programs
resiliency projects and establishing a pilot program
authorized in previous laws with more significant
to give priority for some of the funding to applicants
funding. Of note, a number of programs have
that provide a higher nonfederal funding match. The
expanded eligibility for electric vehicles and alternative
bill also increases the cap on multimodal projects,
1 The bill reauthorizes highway, transit and rail programs for five years and such as those on port property, from $600 million
provides supplemental funding for a number of transportation programs. over the life of the authorization to 30 percent of
Most highway and transit program funding is contract authority, which is
a mandatory form of budget authority. This essentially guarantees that funding available over the life of the authorization.
the authorized funding will be available at the start of each fiscal year
even if reliant on a subsequent appropriation. For purposes of this alert,
we distinguish between programs authorized with contract authority • Bridge Investment Program. The bill makes
and treat the funds for those programs as being made available in the available $12.5 billion for a new competitive grant
bill versus programs that are not authorized with contract authority and
is, therefore, more speculative if the program will receive a subsequent program for bridge investments to assist state,
appropriation.
Infrastructure Investment and Jobs Act 2
local, federal and tribal entities in rehabilitating or accessible electric vehicle charging infrastructure,
replacing bridges. hydrogen fueling infrastructure, propane fueling
infrastructure and natural gas fueling infrastructure
• Congestion Relief Program. The bill makes along designated alternative fuel corridors.
available $250 million for a new competitive States, local governments, transit agencies, port
grant program. States, metropolitan planning authorities and territories may apply for grants.
organizations and cities with a population of more DOT will prioritize grants to rural areas, low to
than one million may apply. Eligible projects reduce moderate income neighborhoods and communities
congestion, including implementing or enforcing with low ratios of private parking or high ratios of
high-occupancy vehicle (HOV) lanes, toll lanes, multihousing units. Fifty percent of grants each
cordon pricing, parking pricing and congestion year are available for community grants to install
pricing, deploying and operating mobility services charging infrastructure on public roads, schools,
and implementing incentive programs that parks and publicly accessible parking facilities.
encourage nonhighway travel and travel during
nonpeak times. • National Electric Vehicle Formula Program. The
bill provides $5 billion to carry out a new National
• Rural Surface Transportation Grant Program. The Electric Vehicle Formula Program for states to
bill makes available $2 billion for a new competitive deploy electric vehicle charging infrastructure and
grant program to increase connectivity, improve to establish an interconnected network to facilitate
safety and reliability of the movement of people data collection, access and reliability.
and freight, generate regional economic growth and
improve quality of life in rural areas. States and local • Carbon Reduction Formula Program. The bill
government entities are eligible applicants. makes available $6.4 billion for a new carbon
reduction formula program. States may use funds
• Promoting Resilient Operations for for projects that reduce transportation emissions,
Transformative, Efficient and Cost Savings including traffic management, public transportation,
Transportation (PROTECT) Grant Program. trails and paths for bicyclists and pedestrians,
The bill authorizes a new formula and competitive advanced transportation congestion management
grant program and makes $7.3 billion available for technologies, intelligent transportation systems,
formula grants to states and $1.4 billion available for projects to deploy alternative fuel vehicles,
competitive grants to states and local governments including charging infrastructure, zero emission
for infrastructure projects that make resilience construction equipment and vehicles and
improvements to address vulnerabilities to current supportive facilities, diesel engine retrofits and
and future weather events and natural disasters and projects that reduce transportation emissions at
changing conditions, including sea level rise. Funds ports. States must develop carbon reduction plans
may be used for highway projects, transit facilities and coordinate and consult with urbanized and rural
and port facilities. areas.
• Grants for Reduction of Truck Emissions at Port • Wildlife Crossings Pilot Program. The bill creates
Facilities Program. The bill provides $400 million a new competitive grant program for projects to
for a new program to reduce idling at port facilities. reduce wildlife vehicle collisions. State and local
governments are eligible applicants and may
• Healthy Streets Program. The bill makes available partner with nonprofits and foundations. The bill
$500 million for a new competitive grant program makes available $350 million for the program.
that funds grants to states, local governments
and tribes to deploy cool pavements and porous • Reconnecting Communities Pilot Program. The
pavements and to expand tree cover. bill makes $1 billion available for a new competitive
grant pilot program of which $250 million is for
• Charging and Fueling Infrastructure Competitive planning grants and $750 million is for construction
Grants. The bill makes available $2.5 billion for a grants. This program is a priority of the Biden-Harris
new competitive grant program to deploy publicly
3 © 2021 Akin Gump Strauss Hauer & Feld LLP
administration and funds projects that remove, transportation system; and (10) improve emergency
retrofit or mitigate previously constructed barriers response. The program encourages private sector
to mobility, access or economic development to innovation and will fund a variety of projects,
restore community connectivity. State and local including coordinated automation, connected
governments are eligible applicants. vehicles, intelligent sensor-based infrastructure,
systems integration, commerce delivery and
• Active Transportation Infrastructure Investment logistics, leveraging innovative aviation technology
Program. The bill authorizes $1 billion for a new such as unmanned aircraft systems, smart grids
competitive grant program for infrastructure and smart technology traffic signals.
improvements that create safe and connected
active transportation facilities, including adding • Culvert Removal, Replacement and Restoration
sidewalks, bikeways and pedestrian trails. Eligible Grant Program. The bill appropriates $1 billion
entities include government entities. The program’s for a new competitive grant program for states to
funds are subject to appropriation. remove, replace and restore culverts to address
the flow of water through roads, bridges, railroad
• Safe Streets and Roads for All Competitive tracks and trails. Subject to appropriation, the bill
Grant Program. Subject to appropriation, the bill authorizes an additional $4 billion for the grant
authorizes $1 billion for a new competitive grant program.
program for local governments to implement
“vision zero” plans and other improvements to
Passenger and Freight Rail Programs
reduce crashes and fatalities, especially for cyclists
and pedestrians. The bill also provides an additional The bill appropriates $66 billion in new spending for
$5 billion in supplementary appropriations. passenger and freight rail programs. The following
summarizes new programs or current programs that
• Strengthening Mobility and Revolutionizing the bill has expanded in scope.
Transportation (SMART) Grant Program.
Subject to appropriation, the bill authorizes $500 • Consolidated Rail Infrastructure and Safety
million for a new competitive grant program for Improvements Grants (CRISI). There is $5
demonstration projects that implement advanced billion appropriated for this program that exists in
smart city or community technologies and systems current law. The bill expands eligibility to projects
to improve transportation efficiency and safety. that prevent trespassing, incorporate innovative
The bill also provides an additional $500 million rail technologies and improve hazardous material
in supplementary appropriations. States, local response plans.
governments, public transit agencies,
• Railroad Crossing Elimination Program. The bill
• public toll authorities and tribes are eligible for appropriates $3 billion for a new competitive grant
funding. The bill directs the Secretary to consider program to eliminate at-grade railroad crossings,
the extent to which a project will use advanced add gates or signals, relocate tracks and install
data, technology and bridges. The bill also sets aside funding for planning
and for grants and contracts to carry out a highway-
• applications to: (1) reduce congestion; (2) rail grade crossing safety information and education
improve safety for pedestrians, bicyclists and the program.
broader public; (3) increase access to jobs and
essential services; (4) connect or expand access • Federal-State Partnership for Intercity Passenger
to underserved communities; (5) contribute to Rail Grants. The bill appropriates $36 billion for this
economic competitiveness; (6) improve reliability competitive grant program. While it is an existing
of the transportation facilities and systems; (7) program, the bill significantly expands funding and
promote connectivity between transportation program scope to reflect President Biden’s focus
modes; (8) incentivize private investment and on passenger rail investment. The bill expands
partnerships; (9) improve energy efficiency, eligibility for projects that improve performance
reduce pollution and increase the resiliency of the or expand/establish new intercity passenger rail,
Infrastructure Investment and Jobs Act 4
including privately operated passenger rail service
Airport Programs
if an eligible applicant is involved. Governmental
entities, Indian tribes and Amtrak are eligible The bill appropriates $25 billion in supplemental
applicants. DOT is required to consider project funding for airports. This is on top of the funds
selection criteria, including a comparison of costs authorized for airports under existing law. In addition,
to benefits, safety, economic development, private the bill makes airport projects eligible for low cost
sector participation in the financing, construction financing from DOT as discussed below.
and operation of a project and whether the
applicant has the legal, financial and technical • Airport Infrastructure Grants. The bill appropriates
capacity to carry out the project. At least 45 percent $15 billion to the Airport Improvement Program
of the funding must go to the Northeast Corridor. (AIP). Of the $15 billion, up to $2.48 billion annually
DOT can enter into multiyear phased funding is for primary airports, up to $500 million is for
agreements for projects. general aviation and commercial service airports
that are not primary airports and $20 million is for
• Local and Regional Project Assistance (the competitive grants to airports participating in the
RAISE/BUILD program). Subject to appropriation, contract tower program and contract tower cost
the bill authorizes $7.5 billion for a new competitive share program. The bill directs the DOT Secretary to
grant program to fund projects that will have a distribute the funding under existing formulas.
significant local or regional economic impact and
improve transportation infrastructure. Eligible • Airport Terminal Program. There is $5 billion
applicants are states, local governments, transit appropriated for a new competitive grant program
agencies and tribes. Eligible projects are highways for airport terminal development projects. The
and bridges, public transit, passenger or freight bill directs the DOT Secretary to issue a notice
rail, port infrastructure, surface transportation of funding opportunity within 60 days after the
components of airport projects, infrastructure President signs the bill into law. Of the funding, up
projects on tribal land, projects to replace to 55 percent is available for large hub airports, up
culverts or prevent stormwater runoff and other to 20 percent is available for medium hub airports
infrastructure projects the Secretary determines are and no less than 10 percent is for non-hub and
necessary to advance the program’s objectives. nonprimary airports. Terminal development includes
multimodal projects and projects for on-airport
• National Infrastructure Project Assistance rail access. The bill requires the Secretary to give
Program. Subject to appropriations, the bill consideration to projects that increase capacity
authorizes $10 billion for a new competitive grant and passenger access, replace aging infrastructure,
program to fund large-scale projects that are likely expand access for people with disabilities, improve
to generate national or regional economic, mobility airport access to historically disadvantaged persons
or safety benefits and are cost-effective. The new and improve energy efficiency,
program is subject to appropriations. Eligible
projects include highway, bridge, freight intermodal • Facilities and Equipment Funding. There is
(including at public ports), railway-highway grade $5 billion appropriated for airport facilities and
separation or elimination projects, intercity equipment.
passenger rail projects and public transportation
projects. Eligible projects must have a cost of at Public Transportation Programs
least $500 million unless they are in a rural area.
The bill appropriates $106.9 billion for Federal Transit
The Secretary is required to rate applications
Administration (FTA) programs over five years. This
as highly recommended, recommended or
includes $69.9 billion in contract authority and $15
not recommended, enter into multiyear grant
billion in general funds for the Capital Investment
agreements for funding and report on awards to
Grant Program; $750 million for the Washington
Congress.
Metropolitan Area Transit Authority (WMATA) and
$21.25 billion in supplemental appropriations for
specified transit programs. The bill reauthorize FTA
5 © 2021 Akin Gump Strauss Hauer & Feld LLP
programs but, unlike the highway and rail titles, discretionary grant program.
includes very few substantive changes to existing
programs. Key programs include: • $68.8 million for the Transit Oriented Development
Planning Pilot Program for projects around fixed
• $33.5 billion for the §5307 Urbanized Area Formula guideway programs.
and 5336 State of Good Repair formula programs.
• $400 million for the passenger ferry program and
• $2.1 billion for the Transit Accessibility for Seniors for low-emission ferries.
and Persons with Disabilities Grant program.
• $1.5 billion for a new competitive railcar
• $4.58 billion for rural program grants. replacement grant program to replace rail rolling
stock.
• $192.8 million for public transit innovation.
• $1.75 billion for Americans with Disabilities Act
• $62 million for technical assistance for workforce (ADA) accessibility improvements at rail stations.
development.
• The bill also makes changes to the safety program
• $18.4 billion for §5337 State of Good Repair grants, (49 USC 5329), including enhanced requirements
which is a new competitive grant program to for safety plans, improved safety training, training
replace rail rolling stock that is past its useful life. regarding de-escalation to reduce assaults on
transit workers and measures to reduce vehicle and
• $5.5 billion for bus and bus facilities grants of which pedestrian accidents involving buses.
$3.16 billion is for formula grants, $2.34 billion for
competitive grants for buses and bus facilities and Port Funding
$374.6 million for low-no emission competitive
grants. • Port Infrastructure Development Program.
The bill appropriates $2.25 billion for the Port
– The bill encourages innovative procurements of Infrastructure Development Program (PIDP),
buses. The bill makes at least 25 percent of the which is a competitive grant program that funds
funds available for the Lo-No program available infrastructure projects at ports. Public ports and
for lower emission vehicles, including natural gas government entities are eligible applicants for these
vehicles. The bill further requires applicants for funds.
zero-emission vehicle grants to submit a zero-
emission fleet transition plan to the FTA that • Army Corps of Engineers. The bill appropriates
includes a workforce transition plan and provides $9.55 billion in supplemental funding for Army
funding for such efforts. Recipients of funds for Corps of Engineers projects.
zero emissions vehicles must use 5 percent of
the funding for workforce development training. Environmental Streamlining
• $24 million for the Coordinated Access and Mobility The bill includes several provisions intended to
program. streamline project delivery and provide for an
expedited process to advance projects through
• $3.88 billion for the growing and high-density states the environmental review process. The following
formula program. provisions are worthy of note:
• $23 billion for Capital Investment Grants (CIG). • Codification of One Federal Decision Policy.
The bill codifies the One Federal Decision policy
– Allows bundling of projects to enable a project put into effect by the Trump administration.
sponsor to move multiple projects through the The purpose of the policy is to facilitate more
CIG pipeline simultaneously. collaboration between the Lead Agency and
Participating Agencies and provide guidelines and
• $5.25 billion for the Low-No (emission) vehicle
Infrastructure Investment and Jobs Act 6
a schedule for undertaking environmental reviews On a general note, the bill requires sponsors of
of major projects. The bill requires DOT to publish projects over $750 million that are public private
a proposed rule and seek comment within a year partnerships (P3) to conduct a Value for Money (VFM)
after the law goes into effect. The bill also makes analysis to evaluate the benefits of pursuing a P3
the FAST-41 permitting process permanent, sets a approach versus a public sector delivery model. The
two-year goal for permitting covered projects and bill requires certain reporting for projects with an
encourage federal agencies to use one document estimated cost of $100 million that are undertaken
to track permitting decisions. through P3s, including reporting regarding the
private partner’s satisfaction of the terms of the P3
• Streamlining of Section 4(f) Reviews. The bill agreement not later than three years after the date of
streamlines Section 4(F) reviews by requiring the the opening of the project.
Secretary to give participating agencies 30 days to
comment and then allows the Secretary to assume The bill also increases the cap for Private Activity
there is no objection if the participating agency Bonds for surface transportation projects from $15
does not comment within 15 days. billion to $30 billion—providing increased capacity
for the private sector to secure DOT approval for
• Reimbursement of Costs for Early Utility pursuing tax-exempt bond financing through a
Relocation Work in Advance of Completing conduit government issuer. Finally, as discussed
Environmental Review Process. The bill would below, the bill establishes a new program for DOT to
enable sponsors of surface transportation projects provide technical assistance to government entities
to relocate utilities before completion of a review considering entering into concession agreements with
of impacts under the National Environmental Policy private entities to finance and operate infrastructure
Act (NEPA) and be able to seek reimbursement of projects.
costs following completion of NEPA provided the
The following are changes to the TIFIA and RRIF
larger transportation project incorporates the utility
programs:
relocation and the relocation does not influence the
NEPA review.
• TIFIA Program. Changes to the program include:
– Eligibility for Categorical Exclusion. The bill
increases the threshold for projects with minimal – $1.25 billion is available over five years to pay
subsidy costs of loans.
federal funds to be eligible for a Categorical
Exclusion so that projects that receive less than
– Extends the deadline for financial close of
$6 million in federal funds or that are estimated
contingent commitments for projects under a
to cost no more than $35 million provided less
master credit agreement from three years to five
than 15 percent of the funds are federal funds
years.
are eligible.
– Expands eligibility to (1) airport projects; (2)
Innovative Financing for Transportation transit-oriented development involving private
Projects sector investment, including commercial
The bill reauthorizes and funds the Transportation and residential development, and related
Infrastructure Finance and Innovation Act (TIFIA) and infrastructure and activities that are ready to
the Railroad Rehabilitation Infrastructure Finance proceed and have a high probability of reducing
(RRIF) programs and makes changes to those the need for federal financial assistance; and (3)
programs. Through these programs, DOT provides projects for the acquisition of plant and wildlife
low interest loans and loan guarantees with attractive habitat pursuant to a conservation plan.
repayment terms to government and private sector
– Increases the amount of a loan requiring an
borrowers to undertake transportation infrastructure
investment grade rating from one rating agency
projects.
to at least two rating agencies from $75 million
to $150 million.
7 © 2021 Akin Gump Strauss Hauer & Feld LLP
– Requires the Secretary to give applicants an – Appropriates $250 million over five years to pay
estimated timeline for approval or disapproval the credit subsidy of loans, up to $20 million per
of a loan and to make efforts to provide such loan.
approval or disapproval within 150 days after the
date on which the applicant submits a letter of – Reserves no less than 50 percent of the
interest. amounts appropriated for short line railroads.
– Extends the final maturity date for secured loans – Makes projects to develop landside port
where the capital asset has an estimated useful infrastructure for seaports serviced by landside
life of more than 50 years, to the lesser of 75 port infrastructure eligible for loans and loan
years after the date of substantial completion of guarantees.
the project or 75 percent of the estimated useful
life of the asset. – Makes transit-oriented development
permanently eligible.
– Allows a government entity borrower to forego
prepaying a secured loan or credit instrument – Authorizes the Secretary to accept as collateral
with excess revenues remaining after it satisfies operating or tenant charges, facility rents,
its scheduled debt service requirements and or other fees paid by transportation service
deposit requirements under the terms of a providers or operators for access to, or the use
trust agreement, bond resolution or similar of, infrastructure, including rail lines, bridges,
agreement, if the borrower agrees to use the tunnels, yards or stations.
revenues for eligible purposes under the federal
– Allows the Secretary to consider revenue from
highway or transit program.
projected freight or passenger demand based
– Requires the Secretary to establish a process for on regionally developed economic forecasts,
expediting loans to government entities where including projections of any modal diversion
: (1) the loan terms substantially conform to resulting from the project.
conventional terms and conditions established
– Authorizes the Secretary to pay the credit risk
by the National Surface Transportation Innovative
premium with interest on loans issued before
Finance Bureau; (2) the loan is rated A or higher;
the enactment of the FAST Act.
(3) the TIFIA program share of eligible project
costs is 33 percent or less; (4) the applicant
– Establishes procedures for applicants to propose
demonstrates a reasonable expectation the
tangible and intangible assets as collateral,
contracting process can begin within 90
exclusive of goodwill. Requires the Secretary
days after the date on which the TIFIA credit
to accept a net liquidation value of collateral.
instrument is obligated; and (5) the NEPA review
Clarifies that where an applicant provides a
is complete.
blanket pledge or assignment of an operating
asset or basket of assets as collateral, the
– Requires the Secretary to notify an applicant
Secretary may consider the market value of
in writing within 180 days after the date on
the assets, or the market value of the going
which the National Surface Transportation
concern, considering (1) inclusion in the pledge
Innovative Finance Bureau has commenced the
of all assets necessary for the independent
creditworthiness review of the project whether
operational utility of the collateral (i.e., tangible
the Secretary has approved or disapproved the
assets such as real property, track and structure,
application.
motive power, equipment and rolling stock,
• RRIF Program. Changes to the program include: stations, systems and maintenance facilities and
intangible assets such as long-term shipping
– Codifies the RRIF program in title 49 of the U.S. agreements, easements, leases and access
Code. rights such as for trackage and haulage); (2)
interchange commitments; and (3) the value
Infrastructure Investment and Jobs Act 8
of an asset as determined through the cost
Research and Innovation
or market approaches, or the market value of
the going concern, with the latter considering The bill makes available $735 million for the Highway
discounted cash flows for a period not to exceed Research and Development program; $550 million for
the term of the direct loan or loan guarantee. the Technology and Innovation Deployment Program;
$127.5 million for Training and Education; $550 million
– Requires DOT to repay the credit risk premium for Intelligent Transportation Systems; and $405 million
and interest accrued when all obligations of a for University Transportation Centers.
loan or loan guarantee are satisfied.
The bill also authorizes the establishment of an
– Requires a borrower to repay a loan or loan Advanced Research Projects Agency-Infrastructure
guarantee within the lesser of (1) 75 years (ARPA-I) program to fund research and development
after substantial completion of the project; (2) on advanced transportation infrastructure technologies
the estimated useful life of the project with through grants, contracts and cooperative
consideration of long term risk; or (3) for projects agreements. ARPA-I is based on similar programs
with an estimated useful life greater than 35 at the Department of Energy (e.g., ARPA-E) and
years, the sum of 35 years and the product of Department of Defense (DARPA). No funding is
the difference between the estimated useful life appropriated for the program requiring that it be
and 35 years multiplied by 75 percent. separately authorized.
– Requires the Secretary to develop a streamlined Additionally, the bill directs the Secretaries of
application process for loans or loan guarantees Transportation and Energy jointly to establish and
the value of which do not exceed $150 million lead a 25-member electric vehicle working group,
and meet other criteria. comprising of federal and nonfederal stakeholders. The
working group will make recommendations regarding
• Asset Concessions. The bill makes available $100 the development, adoption and integration of electric
million for DOT to establish a program to provide vehicles into the transportation and energy systems
technical assistance to governmental entities that across the country. The working group will also
own, control or maintain infrastructure assets and develop a series of reports to Congress on barriers to
are interested in entering into contracts to transfer electric vehicle adoption and possible opportunities
ownership, maintenance, operations, revenues and solutions.
or other benefits and responsibilities. DOT will
provide technical assistance grants and experts
services for governmental entities to evaluate Authors: Susan H. Lent, Scott M. Heimberg,
opportunities for P3s and asset concessions. The Ed Pagano, and Christina Barone
full amount of any asset concession payment less
any amount in transaction costs must be used to
pay infrastructure costs of the eligible entity and
the terms of any concession may not result in any
increase in costs being shifted to taxpayers the
annual household income of which is less than
$400,000 per year, including through taxes, user
fees, tolls or any other measure for use of the
approved asset. This requirement may limit the
utility of this program depending on the user fee
mechanism and type of project.
9 © 2021 Akin Gump Strauss Hauer & Feld LLPEnergy Programs
• Energy Infrastructure Federal Financial
Assistance Program. The bill authorizes and
appropriates $5 billion for a new competitive
grant program known as the “Program Upgrading
Our Electric Grid and Ensuring Reliability and
Resiliency.” The bill directs the Secretary to award
grants through a competitive process to eligible
entities to demonstrate innovative approaches to
transmission, storage and distribution infrastructure
to harden and enhance resilience and reliability and
demonstrate new approaches to enhance regional
grid resilience, implemented through states by
public and rural electric cooperatives on a cost-
shared basis. States, Indian tribes, units of local
The bill provides funding for grant and loan programs government and public utility commissions are
focused on grid reliability and security, renewable eligible to apply.
energy innovation and deployment and ensuring
supply chains critical for energy innovation. We • Energy Improvement in Rural or Remote Areas.
describe key programs below. The bill authorizes and appropriates $1 billion for
a new program to provide financial assistance
to improve the resilience, safety, reliability and
Grid Resilience availability of energy in rural and remote areas and
There is $27.65 billion appropriated for grid ensure the energy generation does not harm the
infrastructure, resiliency and reliability programs. environment. Eligible localities include a city, town
The bill also authorizes funding for programs that will or unincorporated area with a population of 10,000
require future appropriations. Key programs include people or less.
the following:
• Transmission Facilitation Program. The bill
• Grid Infrastructure Reliability Competitive authorizes the Secretary to establish a Transmission
Grants. The bill authorizes $5 billion and directs Facilitation Program to facilitate construction of
the Secretary to establish a new competitive grant electric power transmission lines and related
program within 180 days after the bill becomes facilities. The bill authorizes and appropriates
law whereby the Secretary of Energy will make $50 million over the course of the bill for the
grants to eligible entities to carry out activities program to carry out the program. The Secretary
to make grids more resilient and reliable in the may facilitate projects by entering into capacity
face of extreme weather or natural disasters. Grid contracts, provide loans for carrying out a project
operators, electricity storage operators, electricity and participate with an eligible entity in designing,
generators, transmission owners and operators, developing, constructing, operating, maintaining
distribution providers, fuel suppliers and other or owning a project. Capacity contracts can be
entities as determined by the Secretary may for no more than 40 years and not more than 50
compete. No less than 30 percent of the funds percent of the total proposed transmission capacity
must go to entities that sell 4 million megawatt of the project. The Secretary can also enter into
hours or less of energy per year. Congress would contracts with third parties to market transmission
need to appropriate funding for the program. capacity; however, the Secretary must seek to
terminate a contract as soon as practicable after
Infrastructure Investment and Jobs Act 10determining sufficient transmission capacity has and recycling; construction of one or more new
been secured to ensure long term financial viability commercial-scale advanced battery component
of the project. Entities are required to repay the manufacturing, advanced battery manufacturing or
cost of any facilitation activities over time; however, recycling facilities in the U.S.; and to retool, retrofit
if at the end of the useful life of a project, or the or expand existing facilities located in the U.S.
termination of a capacity contract, there are funds
owned to the Treasury, the Secretary may forgive • Battery Recycling Research, Development
the balance due. The Secretary will fix the interest and Demonstration Grants. The bill authorizes
rate for loans taking into account market yields on $60 million for multiyear grants for research,
outstanding marketable obligations of the U.S. of development and demonstration projects to
comparable maturities. This program also authorizes create innovative and practical approaches to
the Secretary to participate in public-private increase the reuse and recycling of batteries.
partnerships under certain circumstances. Universities, national laboratories, federal and state
research agencies, nonprofits, industrial entities,
manufacturing entities, private battery collection
Supply Chains for Clean Energy
entities, state and municipal governments, battery
Technologies
producers, battery retailers and consortium are
There is $7.712 billion available to establish supply eligible.
chains for clean energy technologies. Key programs
are as follows: • Electric Drive Vehicle Battery Recycling and
Second-Life Applications Program. There is
• Battery Processing Grants. The bill authorizes and $200 million authorized and appropriated for
appropriates $3 billion and directs the Secretary the Secretary to award grants for research,
to establish a Battery Material Processing Grant development and demonstration of second-life
program within 180 days of enactment of the applications for electric drive vehicle batteries that
bill. The Secretary may award grants to eligible have been used to power electric drive vehicles and
entities to carry out one or more demonstration technologies and processes for final recycling and
programs to process battery materials; construct disposal of the devices.
new commercial-scale battery material processing
facilities in the U.S. and to retool, retrofit or expand • Advanced Energy Manufacturing and
existing battery material processing facilities in Recycling Grant Program. The bill authorizes
the U.S. The Secretary is required to prioritize and appropriates $750 million for a new grant
grants to entities located and operated in the program to fund projects to re-equip, expand or
U.S., are owned by U.S. entities, deploy North establish manufacturing or recycling facilities
American owned intellectual property and content, for the production or recycling of advanced
represents consortia or industry partnerships, and energy property or re-equip an industrial or
will not use batteries supplied by or originating manufacturing facility with equipment designed to
from a foreign entity of concern. The Secretary is reduce greenhouse gas emissions of that facility
also required to consider whether a project will substantially below greenhouse gas emissions
provide job opportunities in low and moderate- under current best practices through installation of
income communities, engage with universities and (1) low or zero carbon process heat systems; (2)
laboratories, engage with Indian tribes and reduce carbon capture, transport, utilization and storage
greenhouse gas emissions. systems; (3) technology related to energy efficiency
and reduction in waste from industrial processes; or
• Battery Manufacturing and Recycling Grants. (4) any other industrial technology that significantly
The bill authorizes and appropriates $3 billion and reduces greenhouse gas emissions and has a
directs the Secretary within 180 days to establish a reasonable expectation of commercial viability. The
program to award grants to carry out demonstration bill requires the Secretary to prioritize projects in
projects for advanced battery component low-income census tracts and that will create jobs
manufacturing, advanced battery manufacturing for persons previously employed in coal power
11 © 2021 Akin Gump Strauss Hauer & Feld LLPplants or coal mining and give preference to eligible – Applicants may be public and private sector
entities that are minority owned. entities.
• Critical Minerals Mining and Recycling Research – Projects must have a total cost of at least $100
and Development. There is $500 million authorized million.
for grants to study mining methods, efficient use
and reuse, commercialization, workforce and – The maximum amount of a secured loan is 80
private industry innovation and technology transfer percent of project costs.
from federally funded science and technology.
Institutions of higher education, national – The interest rate is the Treasury rate.
laboratories and nonprofits are eligible recipients.
– The maturity date of a loan is 35 years after the
date of substantial completion of the project
Fuels and Technology Infrastructure Investment
except that if the useful life of the capital asset
There is $27.853 billion appropriated for fuels and is less than 35 years, the term is the period of
technology infrastructure investment. Below is a the useful life of the asset.
summary of key programs.
– In making a creditworthiness determination,
• Carbon Utilization Grant Program. The bill the Secretary is required to consider certain
authorizes and appropriates $310 million for a factors, including the strength of the contractual
new grant program whereby the Secretary will terms of the eligible project; the forecast of
make grants to states, local governments or public noncontractual cash flows supported by market
utilities or agencies to procure and use commercial projections and cash sweeps or other structural
or industrial products that use or are derived from enhancements; the projected financial strength
anthropogenic carbon dioxides and demonstrate of the obligor at the time of loan close and
significant net reductions in lifecycle greenhouse throughout the loan term, including after the
gas emissions compared with incumbent project is completed; the financial strength of
technologies, processes and products. the investors and strategic partners; and other
financial metrics relevant and relied on by the
• Carbon Capture Technology Program. There is lending community and nationally recognized
$100 million authorized and appropriated for the credit rating agencies.
front-end engineering and design program under
the previously authorized the Department of Energy – The credit instrument must be repayable in
(DOE) Carbon Capture Technology Program. whole or part with (1) user fees; (2) payments
owing to the obligor under a public-private
• Carbon Dioxide Transportation Infrastructure partnership; or (3) other revenue sources that
Finance and Innovation. The bill establishes a new also secure or fund the project obligations.
lending program within DOE. The program, known
as “CIFIA,” is modeled after the TIFIA program – A secured loan may not be subordinated to
within DOT. There is $2.1 billion appropriated for the claims of any holder of project obligations
the program. Under the program, the Secretary will in the event of a bankruptcy, insolvency or
make secured loans, provide loan guarantees and liquidation of the obligor except for a public
award grants to projects for common carrier carbon agency borrower that has preexisting debt that
dioxide transportation infrastructure or associated is A-rated and is secured with pledged revenues
equipment, including pipelines, shipping, rail or not affected by project performance.
other transportation infrastructure and associated
equipment that will transport or handle carbon – The Secretary may enter into master credit
dioxide captured from anthropogenic sources or agreements for a program of projects providing
ambient air. Key elements of the program include contingent commitments for future projects.
the following:
Infrastructure Investment and Jobs Act 12– To be eligible for assistance, the applicant must deployment of direct air capture projects, have the
be able to demonstrate it reasonably can begin capacity to capture, sequester and utilize at least
the contracting process for construction within 1 million metric tons of carbon dioxide from the
90 days after the credit instrument is obligated. atmosphere annually from a single unit or multiple
interconnected units.
– The applicant must pay all or a portion of the
federal government’s costs in providing the Hydrogen Research and Development
credit instrument up to a maximum of $3 million
Programs
if sufficient funds covering such costs are not
appropriated. The bill authorizes funding for research, development,
demonstration and deployment of hydrogen from
– The Secretary will set repayment terms based clean energy sources, and establishes a clean
on projected cash flow from project revenues hydrogen strategy and roadmap for the U.S. The
and the useful life of the project. following are some of the key programs authorized by
the bill:
– Repayment must begin no later than five years
after substantial completion of the project. The • Regional Clean Hydrogen Hubs. The bill
Secretary may defer payments at his or her authorizes and appropriates $8 billion for the
discretion. Secretary to establish a program to support
the development of at least four regional clean
– The Secretary may award Future Growth Grants hydrogen hubs in geographically diverse areas
to pay a portion of the cost differential with in the U.S. The Secretary will fund hubs that
respect to any future increase in demand for demonstrate the production, processing, delivery,
carbon dioxide transportation by an infrastructure storage and end-use of clean hydrogen and can be
project. The maximum amount of the grant developed into a national clean hydrogen network
would be 80 percent of the cost of the additional to facilitate a clean hydrogen economy. The hubs
capacity. will demonstrate the end-use of clean hydrogen in
the electric power generation, industrial, residential
– The Secretary is required to report to Congress
and commercial heating, and transportation
on how it will calculate subsidy rates and
sectors.
an analysis and timeline for developing draft
regulations. • Clean Hydrogen Manufacturing and Recycling
Program. The bill authorizes and appropriates
• Carbon Storage Validation and Testing. There
$500 million for two programs. Under the first
is $2.5 billion authorized and appropriated for a
program, the Secretary would award multiyear
new program to fund the development of new
grants, contracts, cooperative agreements or
or expanded commercial large-scale carbon
other agreements authorized in law for research,
sequestration projects and associated carbon
development and demonstration projects
dioxide transport infrastructure.
to advance new clean hydrogen production,
processing, delivery, storage and use equipment
• Regional Direct Air Capture Hubs. The bill directs
manufacturing technologies and techniques. The
the Secretary to establish a program to fund
bill directs the Secretary to prioritize projects
projects that contribute to the development of
that increase efficiency and cost-effectiveness
four regional direct air capture hubs, authorizing
in the manufacturing process, use of resources,
and appropriating $3.5 billion over five years. The
including existing energy infrastructure, and
bill defines a regional direct air capture hub as a
support domestic supply chains for materials and
network of direct air capture projects, potential
components, among other considerations. Under
carbon dioxide utilization off-takers, connective
the second program, the Secretary would award
carbon dioxide transport infrastructure, subsurface
multiyear grants, cooperative agreements or
resources and sequestration infrastructure located
other agreements authorized in law for research,
within a region. Eligible hubs must facilitate the
13 © 2021 Akin Gump Strauss Hauer & Feld LLPdevelopment and demonstration projects to create later than September 30, 2023. There is $10 million
innovative and practical approaches to increase the authorized and appropriated for this program over
reuse and recycling of clean hydrogen technologies. five years.
• Clean Hydrogen Electrolysis Program. The Miscellaneous
bill directs the Secretary to establish a new
demonstration program to commercialize, improve The bill authorizes and/or appropriates funding for a
the efficiency, increase the durability and reduce number of renewable energy demonstration projects
the cost of producing clean hydrogen using authorized in prior laws, including the following:
electrolyzers. The goal of the program is to reduce
the cost of hydrogen produced using electrolyzers • Clean Energy Demonstration Program on
to less than $2 per kilogram of hydrogen by 2026. Current and Former Mine Land. The bill
The bill authorizes and appropriates $1 billion to establishes a program to demonstrate the viability
implement the program. of carrying out clean energy projects on current and
former mine land. The bill authorizes the Secretary
to award up to five demonstration projects. The
Nuclear Energy Infrastructure
Secretary is required to prioritize grants that have
• Civil Nuclear Credit Program. There is $6 billion the greatest potential to create jobs and economic
authorized and appropriated for the Secretary to development in distressed areas and the greatest
establish a civil nuclear credit program to evaluate reduction in greenhouse gas emissions. The bill
nuclear reactors projected to cease operation due authorizes and appropriates $500 million for this
to economic factors and select certified nuclear program over five years.
reactors to be allocated credits.
• Energy Storage Demonstration Pilot Grant
Program. There is $355 million appropriated for this
Hydropower
program authorized under the Energy Act of 2020.
• Hydroelectric Production Incentives. The bill
• Long-Duration Demonstration Initiative. There
appropriates $125 million for fiscal year 2022 for
is $150 million appropriated for the Long-duration
hydroelectric production incentives as authorized in
Demonstration Initiative and Joint Program
the Energy Policy Act of 2005.
authorized under the Energy Act of 2020.
• Hydroelectric Efficiency Improvement
• Advanced Reactor Demonstration Program.
Incentives. The bill appropriates $75 million for
There is $2.48 billion appropriated for the Advanced
fiscal year 2022 for hydroelectric production
Reactor Demonstration Program authorized under
incentives as authorized in the Energy Policy Act of
the Energy Policy Act of 2005.
2005.
• Carbon Capture Large-Scale Pilot Projects. There
• Maintaining and Enhancing Hydroelectricity
is $937 million appropriated to carry out the Carbon
Incentives. The bill authorizes and appropriates
Capture Large-scale Pilot Projects authorized in the
$553.6 million for the Secretary to make incentive
Energy Policy Act of 2005.
payments to owners or operators of qualified
hydroelectric facilities for capital improvements
• Carbon Capture Demonstration Projects
directly related to improving grid resiliency, dam
Program. There is $2.5 billion appropriated for this
safety and reducing environmental impacts.
program authorized in the Energy Policy Act of
2005.
• Pumped Storage Hydropower Wind and Solar
Integration and System Reliability Initiative.
• Industrial Emission Demonstration Projects.
The bill directs the Secretary to establish a
There is $500 million appropriated for this program
demonstration project for a pumped storage
as authorized in the Energy Independence and
hydropower project to facilitate the long-duration
Security Act of 2007.
storage of intermittent renewable electricity no
Infrastructure Investment and Jobs Act 14• Solar Energy Research and Development. The bill and Gas Compact Commission, and
authorizes $80 million for solar energy research and confirm that the state has one or
development subject to a future appropriation. more documented orphaned well.
Additionally, there is up to $5 million
– Orphaned Well Site Plugging, Remediation for states that have an existing
and Restoration. The bill appropriates $4.7 plugging, remediation and reclamation
billion for the Interior Secretary to establish a program for orphaned wells and the
program to provide funds to plug, remediate and capacity to initiate such a program or
reclaim orphaned oil and gas wells on federal, carry out a grant.
state and tribal lands.
– Formula Grants. There is $2 billion
• Funding for Federal Lands. There is in formula grants available for states.
$250 million available for the Secretary The formula will account for job
of Interior to provide funds to plug, losses in the oil and gas industry
remediate and reclaim orphaned wells in the state beginning on March 1,
located on federal lands. Under the 2020, and ending on the date of
program, the Secretary will identify the bill’s enactment. Additionally,
orphaned wells and associated pipelines, the formula will account for the
facilities and infrastructure and rank number of documented orphaned
those orphaned wells for priority in wells located in the state and the
plugging, remediation and reclamation projected cost to plug or reclaim those
based on public health and safety, orphaned wells, reclaim adjacent
potential environmental harm and other land and decommission associated
subsurface impacts or land-use priorities. pipelines, facilities and infrastructure.
The Secretary will also identify and To be eligible, states must describe
address any disproportionate burden of its program for orphaned well
adverse human health or environmental cleanup, including legal authorities,
effects of orphaned wells in underserved processes used to identify and
communities. prioritize orphaned wells, and other
program elements demonstrating the
• Funding for State Programs. There is
readiness of the state to carry out
$4.275 billion available for the Secretary
proposed activities using the grant.
to award initial, formula and performance
grants to states to plug, remediate
– Performance Grants. There is
and reclaim orphaned wells on state
$1.5 billion in performance grants
or privately owned land, identify and
for states, including regulatory
characterize undocumented orphaned
improvement grants and matching
wells and rank orphaned wells based
grants. To be eligible, states must
on factors such as public health safety,
submit an application describing the
potential environmental harm and other
activities carried out by the state to
land use priorities.
address orphaned wells, including
its efforts to increase state spending
– Initial Grants. There is $775 million
on well plugging, remediation and
available for the Secretary to provide
reclamation, or improve regulation
initial grants to states. Of this funding,
of oil and gas wells. Additionally,
up to $25 million is for states that
the state must describe the means
submit an estimate of the number
by which it will use funds to lower
of jobs that will be created or saved,
unemployment in the state and
certify their membership or associate
improve economic conditions in
membership in the Interstate Oil
economically distressed areas. States
15 © 2021 Akin Gump Strauss Hauer & Feld LLPmay receive up to two $20 million program. The bill also expands the eligibility of the
regulatory improvement grants for Advanced Technology Vehicle Manufacturing Loan
states that have strengthened their Program to include medium and heavy-duty vehicles,
plugging standards and procedures in trains, locomotives, maritime vessels, aircraft and
a manner that protects groundwater Hyperloop technology. The bill makes projects that
and other natural resources and increase the domestically produced supply of critical
made improvements to its programs minerals, including through production, processing,
designed to reduce future orphaned manufacturing, recycling or fabrication of mineral
well burdens. Lastly, states that alternatives, eligible for DOE loans. Finally, the bill
increase spending on orphan well makes certain Alaska natural gas transportation
cleanup may receive up to $30 million programs and systems eligible for loan guarantees.
in matching grants.
Energy Efficiency and Building
– Funding for Tribal Programs. There
Infrastructure
is $150 million to establish a program
for the Secretary of Interior to provide The bill makes funding available for a variety of grant
Indian tribes grants to plug, remediate and loan programs to encourage investment in and
or reclaim an orphaned well on tribal deployment of energy-efficient improvements:
land.
• Energy Efficiency Revolving Loan Fund
– Abandoned Mine Reclamation Fund. The bill Capitalization Grant Program. The bill directs the
appropriates $11.29 billion for the Abandoned DOE Secretary to establish a revolving loan fund
Mine Reclamation Fund established by the capitalization grant program under the State Energy
Surface Mining Control and Reclamation Act of Program within one year of the bill’s enactment
1977. The Secretary of Interior would provide and authorizes and appropriates $250 million for
formula grants to states and Indian tribes for fiscal year 2022 for the program. The Secretary will
the reclamation and restoration of land and provide funding to states to capitalize revolving loan
water resources adversely affected by past coal programs. States can use the funding to make low
mining practices and to protect public health, interest loans to recipients to conduct commercial
safety and property from these adverse effects. energy audits and residential energy audits and
The total amount of funding is not be less than make energy upgrades or retrofits.
$20 million, and the Secretary may prioritize
reclamation projects that employ current and • Grants for Energy Efficiency Improvements and
former employees of the coal industry. Renewable Energy Improvements at Public
Schools. The bill authorizes and appropriates $500
– Abandoned Hardrock Mine Reclamation. million for the Secretary to award competitive
The bill authorizes $3 billion for the Secretary of grant to public schools to make energy efficiency,
Interior to establish a new program to provide renewable energy upgrades and purchase
formula grants to states and Indian tribes to alternative fuel vehicles and infrastructure.
inventory, assess, decommission, reclaim,
respond to hazardous substance releases on and • Weatherization Assistance Program. The bill
remediate abandoned hardrock mine land. The authorizes and appropriates $3.5 billion for fiscal
bill reserves 50 percent of funding for grants to year 2022 for the weatherization assistance
states and Indian tribes and 50 percent for use program.
on federal land.
• Energy Efficiency and Conservation Block Grant
Program. The bill authorizes and appropriates
DOE Loan Program
$550 million for fiscal year 2022 for the program.
The bill makes changes to the DOE Loan Programs. It also expands eligibility to programs that
The bill clarifies what DOE can consider in evaluating finance energy efficiency and other clean energy
an applicant’s creditworthiness—similar to the CIFIA
Infrastructure Investment and Jobs Act 16You can also read
