Nationally Significant Freight and Highway Projects

The Bipartisan Infrastructure Law authorizes the Nationally Significant Multimodal Freight and Highway Projects program at $8 billion for fiscal years FY 2022-FY2026, to be awarded by DOT on a competitive basis to projects of national or regional significance that meet statutory requirements. NSMFHP grants may be used for the construction, reconstruction, rehabilitation, acquisition of property (including land related to the project and improvements to the land), environmental mitigation, construction contingencies, equipment acquisition, and operational improvements directly related to system performance. NSMFHP grants may also fund developmental phase activities, including planning, feasibility analysis, revenue forecasting, environmental review, preliminary engineering, design, and other preconstruction activities, provided the project meets statutory requirements including that they are based on the results of preliminary engineering. All large projects funded with NSMFHP grants must be reasonably expected to begin construction not later than 18 months after the date funds are obligated for the project. The Department will divide grants under the NSMFHP program into large and small projects. For large projects, the IIJA specifies that NSMFHP grants must be at least $25 million. For small projects, the grants must be at least $5 million. For both large and small projects, maximum NSMFHP awards may not exceed 60 percent of future eligible project costs. At least 15% of funding are reserved for small projects. Applicants are strongly encouraged to submit applications only for eligible award amounts. No more than 30% of funding per year may be used for grants to freight rail, water (including ports), or other freight intermodal projects that make significant improvements to freight movement on the National Highway Freight Network. Only the non-highway portion(s) of multimodal projects count toward the 30% maximum. Improving freight movement on the National Highway Freight Network may include shifting freight transportation to other modes, thereby reducing congestion and bottlenecks on the National Highway Freight Network. Grade crossing and grade separation projects do not count toward the 30% maximum for freight rail, port, and intermodal projects. The FAST Act directs at least 25 percent of the funds provided for NSFHP grants, are to be used for projects located in rural areas. If the Department does not receive enough qualified applications to fully award the 25 percent reserved for rural projects, the Department may use the excess funding for non-rural awards. DOT must consider geographic diversity among grant recipients, including the need for a balance in addressing the needs of urban and rural areas.