- Progress being made in getting the funds: any challenges/red tape
- Competition for grants
- Best ways to win grants: focus on equity, safety, environment, justice, climate
- Buy America provisions
- How the IIJA is incentivizing innovative delivery models
Christine Reynolds (00:07):
Hello everyone. Great to see you all in here and those that are outside and soon to be in here. We are here for a deeper dive into all things infrastructure and really infrastructure act. The IIJA is here to discuss that and other details with this excellent panel this afternoon. I am pleased to introduce them right here nearest to me is Jacqueline Knights, director for the Oregon State Treasury Debt Management Division. Next to Jacqueline is Emily Brock, the Director of Federal Liaison Center for GFOA. Next to Emily is Angelica Valencia, partner at Nixon Peabody and at the end of the table, Justin Edwards, State of director for the National League of Cities. Welcome our illustrious panel and we will let them get underway.
Jacqueline Knights (00:58):
Thank you.
Angelica Valencia (01:00):
Thank you. Good afternoon everyone. I am Angelica Valencia mentioned, I am a partner at Nixon Peabody. Before we start our discussion, I think I want to give everyone a little bit of an opportunity to further discuss their experiences and their background. So I will start on my right and then maybe we can work ourselves this way, so Justin.
Justin Edwards (01:17):
Hi, Justin Edwards with the National League of Cities. I am actually leading a really interesting new initiative in partnership with a number of other philanthropic organizations, US Conference and Mayors, results for America. Really trained at technical assistance, providing technical assistance to cities across the country. To connect with these funds, we are primarily targeting cities of 150,000 and smaller populations.
Emily Brock (01:44):
So Emily Brock, I am with the Government Finance Officers Association here in Washington DC. Our organization boasts a membership that has not slipped. It is been growing continuously. We are at about 22,700 members, and so it is a great organization for issuers to get together to talk about best practices and advisories and to promote the great things that finance officers are doing across the country.
Jacqueline Knights (02:12):
Thank you. I am Jacqueline Knights. I am the director of Debt Management for Oregon State Treasury. I the treasurer's designee, the treasurer for all is issuance of debt for all agencies in the state of Oregon. By statute, the treasurer is the issuer of all debt in Oregon and in my capacity, I also serve as this treasurer's designee on various boards including the infrastructure, finance authority and the private activity bond committee, as well as provide guidance to the legislature on debt capacity issues.
Angelica Valencia (02:53):
Thank you. By the way the infrastructure law will allow funding to be available to state and local agencies, but before we sort go dive further in death to the difficulties and other challenges that t 530he ACT has been facing, I am going to give Emily the opportunity to give us a broad overview.
Emily Brock (03:09):
Thank you. So here in Washington, obviously the last four years have been a little bit of a locomotive running down the track where we have seen big stimulus bills, a lot of conversation about infrastructure and frankly a lot of things for local governments to get used to appreciate and understand the distribution, but then also understand where they play a role, how they kind of move forward. First of course, we had the American Rescue Plan Act, which a 350 billion distribution of proceeds to distribution of money to local, state and local governments. Then in the middle we had the infrastructure investment in Jobs Act, which was another 560 billion focused on infrastructure. And this morning we had a panel on the Inflation Reduction Act, which was a reconciliation bill passed with only democrats voting. So we are here today to kind of talk about the middle one, which it is our luck to actually have a middle one to talk about.
(04:10)
It is 560 billion of money that is specifically identified for investment in infrastructure. Some of them are appropriations that are manageable and are distributed by formula or otherwise known as formula grants, discretionary grants. And then there is where there is competition for those funds. So a portion of that 560 billion is dedicated to a competitive kind of application process. And we will be using an acronym here for the rest of the panel called NOFO, which is one of my favorite acronyms in Congress. The notice of funding opportunity and what we say at GFOA is you just do not want to have NOFO, FOMO right? So the NOFO is the one thing that we focus on. That 560 billion to be honest, has been distributed through a lot of federal authorizing agencies. So the Department of Transportation, for example, the EPA, Even Department of Commerce, we are seeing a lot of the funds starting to flow out to those federal agencies who then accept the NOFO, make a determination of award and then award the program.
(05:25)
So there is certainly still a lot of stuff in the mix right now, but one thing I did want to mention before we get too far about application and understanding where the money is going is what has been prioritized by this plan. So the Infrastructure Investments and Jobs Act is kind of the baby of bipartisan cooperation in the middle of an all democratic Congress. So this was a bipartisan bill, it was passed with Democrats and Republicans alike, but it still has key themes from the Biden administration, which are very important to implementation and qualification and eligibility of these NOFO's, first of all, equity plays a really large role and when we talk about equity, we can talk about equity in the form of whether it was it is racial justice and racial equity, or you can also talk about climate justice and climate equity. You can talk about equity in all kinds of forms and it materializes in all kinds of forms through the different NOFO.
(06:24)
Another key theme that we are noticing with the NOFO is sustainability and environmental focus. So of the NOFO that we see coming out, we see a lot of concentration on build back, but better was not just a fun alliteration tool, it actually means are you going to build this infrastructure back better for sustainable purposes? And last but not least, one of the key themes that we see throughout the NOFO is an element of partnering. And it rings true from many of the panels that we had earlier today on p3 and partnering with either private firms but also in some ways some folks are starting to talk about partnering with philanthropic agencies too, and that might help your application in the NOFO. So those key three themes have started to materialize as we have seen the NOFO come up. But keep in mind we are at this point, almost at the end of year one. This is a six year bill or almost a sixth of the way through. I do not know what that is in terms of percentages, but we are almost a sixth of the way through. And I would say, and we are going to go into this a little bit, is not everybody has known where the floodgates are, where they can access the capital and understanding how they themselves are eligible. So we are inching along right now that timeframe, which is starting to creep up behind us very quickly.
Angelica Valencia (07:53):
Thank you. And I think one of the things Emily mentioned was there is a lot out there available, but there is also some lack of knowledge with respect to what is actually there. I think Justin, when we were talking, you mentioned that there you are sort of working on creating more knowledge base with issuers. Can you describe your experience?
Justin Edwards (08:11):
Yeah, so our target audience being smaller, mid-sized cities a lot of times what we are finding so far and connecting with National League cities already has a membership base of 2,700 cities. So we have a good idea of what is the kind of awareness of certain grants, the timing, the availability, the eligibility but we are actually working outside of our membership base. So this is a national program. We just are wrapping up two weeks I think is our final, we do online learning, basically we set up an online university and we take people take cities through a three to four month bootcamp all the way from the very beginning tell them this is the grant application for this particular grant from this agency. We walk through the eligibility requirements, we help them understand the financing aspects of it and developing their budget as requested by the application. We built a data platform for them to utilize to actually talk about some of the equity and bring in the sustainability metrics that are requested sort on a case by case basis per application.
(09:16)
And then the real interesting work happens when they actually have to start writing the application itself. Because every application's very different. We are trying to take a very modular approach and help them understand that at each sort of level of class they are going to be actually generating something that can just modularly sort of slot into that application. When we get to the final stages, we really are having the leaders of the classes emerging, the more vocal cities. What we are learning is very difficult to know all of the nuance eligibility issues until you actually get your hands on the applications themselves, which is hence an opportunity to improve that communication from the agencies themselves to the cities. We are also finding that sometimes having an idea of a project, it is a great idea. You definitely have a demonstrated problem, but that project just so happens to not be acceptable in the final stages of that application.
(10:19)
There is a lot of learning that can happen getting up to that stage. And then sadly we will see potentially people bottom have to go back and start all over again and maybe wait for next year's updates to come out. I think just one final point here, just to kind of illustrate just before this session started, I looked up sort just keyword search on broadband. There is probably a hundred different programs out there by 15 different funding agencies that will support a broadband implementation. And depending on your particular need, it is really difficult I think from the get go right now to say, I connect more with a US Department of Agriculture grant than I do a US Department of Education grant. And I think improving that kind of knowledge and improving the outreach from the federal government side to the cities to really understand the opportunities is unprecedented about a money. There is a lot that we are still learning. I mean, to Emily's point, we are nearing the end of year one. Our group is just about to launch a new three to four month bootcamp for five new grant programs. So we are going to double basically the size of those cities that we have put through already, which is around 200 cities. And again, continuing to learn, what we are really thinking about is how do we create this feedback loop then back to the agencies, back to the federal government, think about how we can strengthen this process and opportunity.
Angelica Valencia (11:50):
I think Jacqueline, you probably have a slightly different perspective being an issuer. Can you share your experiences as to with respect to any of the difficulties that are being faced from in Oregon?
Jacqueline Knights (12:03):
Well, I mean Oregon probably qualifies or have entities that are eligible for all of these funding programs. So you can imagine the magnitude of work that needs to be done. The governor did appoint an infrastructure director earlier this year to manage the communication with the federal government, but really that one resources is really insufficient. Most of the funding that Oregon gets, I will just focus on two agencies of the state. Oregon Health Authority really gets the funding for the Drinking Water State revolving loan fund program. And Oregon DOT is our transportation group. With respect to the drinking water programs we facilitate loans to local governments. So we actually do reach the communities. And some of the grants are the incremental grants coz we have the four M grants and now we have the supplemental emerging contaminants and lead service line. We have significant funding available for Lead 186 million over this period of time general supplemental and the emerging contaminants.
(13:22)
Oregon has a couple issues or challenges with this program. In middle of 2002, the revolving fund conducted a statewide survey of communities to determine their project needs with the goal of establishing a pipeline. And about 38% of the community responded with 1.1 billion of projects. I mean that far outpaced what is available. However one of the issues that we face is the o ha will apply for all the grants available. However, there are two challenge main challenges with the drinking water program. Oregon uses a simple definition of disadvantage communities. So basically we apply a median household income, so for all of Oregon, and then if you fall below that, you could qualify for being disadvantaged. But that there are many gradations of disadvantage, right? And so the legislation requires not only defining disadvantage, but it is also tracking the data associated with it. And we do not have the mechanisms in place right now and are developing it.
(14:43)
In fact, business Oregon led a committee to review this aspect of the legislation. And so we are working through addressing the metrics that is needed. The second issue is with respect to lead apparently there is some restrictions on what parts of the piping is eligible for funding for the lead program. And Oregon did a lot of that work in the 1980s, but there may be some lead in some of the major cities in Oregon, but it is in the water mains. And guess what, I understand that those are not eligible for the lead funding. So the issue is there that a substantial amount of funding for the supplemental funding may not be utilized by Oregon. So one of the things that we need to do at the state level is to communicate to the communities here, there is a big part of money, but gauge your expectations as to what we can actually yield from this program. And I think I can maybe I will just hold my comments to that get to the rest later.
Angelica Valencia (16:02):
I think everyone sort of touched base a little on what, what is working, what is available. I think this question probably goes to just in Emily, but from your perspective, what is actually working and what will you recommend to strengthen the application process? And are there differences between the various different programs that you see while working with people
Emily Brock (16:23):
You want to? Sure. So what is working, I think that there is significant communications campaign on behalf of the federal government. I think that they are trying to get the information out as best as they can. And I think what is important is they utilize national organizations like the National Gift Cities and GFOA to help us to socialize it, to make sure that we do not have a no FOMO breakout, that we in fact allow for them to see trackers and understand where and how their eligibility applies. I think there is definitely room for growth. Say for example if we are talking about a word like equity or a word like disadvantaged or a word like sustainability, that is going to come with some metrics. And those metrics have to comport with the states. That is what we are finding is that there is a lot of local governments who seek to achieve some of the guidelines, some of the controls that have been in place around this federal money, but make it so that it can be usable by local governments inside of states with other definitions and those controls.
(17:42)
I think if we think about the controls on the money, that is of course an important element of federal grants to begin with. But that is always the rub when it comes to recipients and whether or not they are eligible because once you realize that there is money out there, that you have got to start thinking about your internal controls from a local government perspective, not just eligibility because I think we are smarter than that. We realize that there we are eligible, but then it is a relationship that lasts 10, 15, 20 years with the federal government and those controls that have to be in place to manage that has to live throughout the life of that grant. And that has become in and of itself one of the biggest challenge for small and rural communities who this administration and this legislation seeks to get to. So if you do have an opportunity in Seward, Alaska where the part-time controller is also the part-time doc hand you have to make sure that you are speaking to that person and their eligibility is not diminished because they do not have the internal control systems and guidance that San Diego does. And I think that that is something that we are continuing to push on the administration every time we see a NOFO to talk about what are the compliance requirements, what do they look like, and how might we be able to ease that burden so that the distribution helps to achieve the federal the goal that the federal legislation seeks to seeks to achieve.
Justin Edwards (19:16):
Yeah, I think it is a great point and just you can illustrate this by looking at two different tools actually from two different agencies that they have developed to help cities understand what does disadvantage mean. So department of Transportation put out what they call their disadvantaged communities map. From a user perspective, it is a different experience say than the Department of Energy's energy disadvantaged mapping tool. So there are tools available for cities, but again, to Emily's point, sometimes the formulas differ. And so you are starting to talk about this disadvantaged conversation to qualify you for an application in a different way. So every time there is a different grant opportunity, you really need to scrutinize the NOFO, ideally get your hand on the application first. Again, that process is not also universal or standardize across agencies either. So there is a lot of opportunity to miss the boat on this connecting metrics with the application nuances themselves.
(20:21)
And then to your second point, I think what we are finding also is we see just extremely limited capacity to take on even the process of an application, let alone the implementation, the relationship for 10 years in many cases. We try to fold in a lot of this capacity building as our last lesson in our infrastructure hubs classes to really kind of ground the expectations of what's facing. If you do win a grant grant and do get this money and then have to actually implement the project what does that look like moving forward? it is not just about getting that winning application.
(20:58)
I think we are going to see a lot more money coming on the table now in January, February. I know that we are kind of looking at just a couple different Department of Transportation grants already now that have some just very specific nuance differences. Safe streets for all grant, reducing TRA traffic incidents and increasing pedestrian safety. There is a planning grant and then there is sort of a project implementation grant. And they are going to end up being very, very different. And so some cities may come with the expectation of the larger pot and end up finding themselves much more eligible, much more ready to actually achieve the planning grant instead. And they also in the long run learn a lot about their own internal capacities.
Jacqueline Knights (21:46):
If I might add to that, I think that the state plays a critical role in this, and therefore the communication has to exist between the state, the local government and the federal partners. And from what I understand from my folks who deal with the federal partners, they feel that those individuals are working really hard. They have good relationships, but they're tapped out. I mean, again, this came on the heels of the arpa, but the state itself can provide interim funding. So project readiness for smaller jurisdictions or smaller localities, smaller projects needs state support. And I think this coordination is critical to making sure that this funding actually achieved the goals it was designed to.
Emily Brock (22:38):
I like the on ramp concept. You can contact your state and it will help you sort of on ramp in. No, no, not every state is awesome as Oregon, of course, chip, Virginia is a close second, but so on ramping and relying on your state is especially important. But that planning grant, that safe streets for all, the more that we see these sort of planning opportunities that on that thoughtful on ramp was not something that was afforded to all of the different parts of the law, right? But I think that that was a thoughtful approach that might have been a missed opportunity in some of the other monies in some of the other grants.
Justin Edwards (23:22):
And we saw in a FEMA grant that I think that the deadline is just passed now within the building Resilient infrastructure and communities, the brick program, there was a pocket of money, I think for planning grants in there also, but it was kind of buried a little bit. It was hard to identify that that could be just a very unique opportunity for you, let alone as an alternative to chasing a project grant.
Emily Brock (23:51):
And I would say too, IT planning grants are great, but nothing could help people plan for the Build America by America stamp that is been put over top of this money. So the Build America by America is sort of legacy from ARA build America by America is executed by executive order, which means it is the president's rule of thumb over top of the federal legislation. And when we went to OMB and we said, whoa, help us understand domestic sourcing for all of the ways to build this infrastructure, help us to better understand what you mean by that. They said, well, it applies to all the money. There you go. And so we were kind of like, well, hang on a second. What if we are looking at a water project, say for example in the srf and it has already begun construction. What about a B waiver for the rest of that project? So there is been a lot of technical massaging of some of the sort of federal controls that are being put over this so that the monies can then be utilized more effectively.
Angelica Valencia (24:55):
And I think there was some, we briefly touched base with Jacqueline with respect to the whole rural versus the city. And then you also brought it up. What changes we recommend to make sure that the state and local government is really getting the funding that is that they require. I kind of want to hear, yeah, Jacque's perspective first,
Jacqueline Knights (25:15):
Oregon is a unique state because we rank in terms of land mass at say maybe top 10 or something or close to that. But in terms of population, we are 39th, which means that we have three big one major city, two small cities, and then we have the rest of Oregon. It looks like the country for the most part, east, west, and everything in between. So we are going to have to conduct the outreach that I talked about, Oregon Health authorities actively reaching out to the communities, sending them comment papers, say, come give us your comments. We are going to, business Oregon is going to have to go out to those communities and canvas people. Some people you can not get ahold of them. We have the list. It is going to take a statewide coordination. So we have to engage the stakeholder improve the interagency coordination look at a statewide project list, because even if the federal government money is insufficient because we have capacity, we have exhausted our capacity, then the state can pick up the delta on that. So there is a lot of things that we can do. I know OHS currently working on updating is its ratings process for projects because of the new criteria that is being established. And we also benefit, we also have a lot of tribal governments. I think we are the poster child for this Bill.
(27:01)
So allocating funds to the tribal governments, we do have a committee of tribal government leaders and we want to be sure that we get the word out to them so that they can also benefit from the funding that is available.
Emily Brock (27:18):
Yeah, and so, the sort of larger capacity organizations, of course it is funny cuz when we put out of an APB to GFOA members, we notice there are some that have grants managers hired. And then to Jackie's point, we have also done a workforce study that says we have a gray of the bench, we have a silver tsunami. Our talent pool is shrinking, our talent pool is small. And so you have this sort of I think bigger of economic challenge where we would love to have all of the resources available to be able to take advantage of these federal opportunities. But the smaller rural organizations are still having trouble with staffing. Some of the even larger organizations are having trouble with staffing and to be able to have the capacity and to know that these opportunities are there and plan for it. Jackie and I were talking earlier if you are starting to plan for this four years from now, you are out of the race. That is right. That from a biannual budgeting perspective, you going to start planning now. And so wondering if that is the case in Oregon.
Jacqueline Knights (28:29):
It is absolutely the case. I mean when I think of odat, which is has a long history with the federal government and federal funding because of the highway program, transit gets all the dollars in from the highway program into the state and manage disbursement. Those fun still, we have major projects in play and with a BI budget budgeting process in legislative session. If we do not plan for the use of these funds in the upcoming legislative session, we will have to wait potentially two years to put it into the next legislative session, which exhaust about three years of opportunities for large scale projects. That is huge for us. And so we cannot afford to fall behind for the competitive bridge programs going after those monies and anything else that we can get. The congestion mitigation increasing in congestion mitigation funds regional the regional funds to enhance mobility, safe streets, safe smart streets, safe neighborhoods. We have so much work to do. Importantly also, Oregon has embarked on a strategy to provide about 25,000 units of affordable housing because we do have a affordable housing problem in Oregon. And so seeing how we can leverage these funds to address the homelessness and create more affordable housing in Oregon is also a key part of that initiative. And that is something that is less thought about, but it is a huge problem for the state.
Angelica Valencia (30:25):
California will agree with you from California. Homelessness is a big issue for us too. What about you Justin? What is your take on recommended changes?
Justin Edwards (30:35):
Yeah, I mean, I think we hear a lot about reducing the sort of burden of the local match. This is something that will catch a lot of cities along the way. We are a membership organization, so we do not have a hard time connecting with our members or with other cities in our universe. I think that there are networks at the state level to your point, Jacqueline's working with the state municipal leagues who also can play that role in educating, disseminating the information, actually backfilling perhaps some of those capacity gaps. What I am seeing is a lot more people of stepping up and wanting to get involved in partnership with the education, the assistance, these infrastructure grants do not just stand to rebuild a bridge. Going back to your point, this vision setting of build back betters really inherently built in. There are job opportunities inherent with these projects.
(31:36)
There is sustainability improvements inherent with these projects. And even, I just familiarized myself with some of the FEMA grants. There is an opportunity to actually make your application more competitive if you choose a nature based solution as opposed to a physical concrete barrier. So you are kind of killing two birds with one stone in a very understated way with these. And so we need more of those partners who are familiar with the varied aspects coming to the table and talking about, I think the infrastructure bill especially, and as well as the vision that each of these agencies has set for themselves within it.
(32:18)
I mean, I look forward to, I am scared of the numbers of the registrations that we are going to have coming in a few weeks, but I am actually looking forward to seeing rural communities. We had a lot of rural communities. I was just looking at some numbers. We had over 500 cities register for the first phase, and it was an accelerated phase for three different applications. Over 115 of the 200 final cities that went through the bootcamp were under 10,000 populations. So there is a huge appetite in those communities where they are targeting these dollars. There is also a very visible, now more visible capacity gap that we need to address in other elements of our respective organizations. For sure.
Angelica Valencia (33:05):
I think one of the big items that we were discussing was feedback. How do the local governments actually share their experiences to make sure that we are learning from how to best implement these kinds of funding opportunities. Do you have an understanding on take on that?
Justin Edwards (33:22):
Yeah, and we are capturing a lot of information around experience, around success rates, around how many applications are filed, how many times are they new filers are any of these cities, have they ever won a competitive grant before? Is this a completely new process to them? And then we have a federal advocacy division within the National League of Cities who has a lot of conversations with the right partners in government. So we know that the experience is being conveyed. I do not know what the next step really is until we can really start seeing success stories. Yeah,
Emily Brock (33:55):
Yeah. I mean I think that many of you and your issue or clients, you all are going through this with them. You all are relationships and all the issuers in here, hi again. You know all are sharing your frustrations with the market. And I think that there is a way that we can capture feedback that we are, we can certainly provide it back to the administration. But I mean the effectiveness of the feedback really is over the next six years because I will get into politics in just a minute, there is probably not another opportunity for us to share our frustrations with getting 560 billion from federal legislation over the next however long. So the feedback loop in and of itself has to be rapid. I mean, there has to be ways that we can aggregate this data as people are applying for it now, which is again, grateful in Bloomberg and NLC for pulling together that data. But also we as a market can come together and bond Byer host these lovely events where we can bring that all together and start to aggregate that information in a rapid way.
Jacqueline Knights (35:06):
During Covid, I had to speak to the ways and means committee on broadband and the issues of equity. And I frequently speak to the rating agencies on behalf of the state. Basically the voice of the state to the rating agencies and ESG is a significant issue for Oregon. We take it seriously. Resiliency is part of everything we do where Treasury now resides in a building that can withstand earthquakes at 9.5, 9.2 on the Richter scale because it does not sit in the ground, it floats. So you all come to Oregon.
(35:49)
To the state treasury to fine shelter but we are prone to incidents of climate events, geographical issues that could take away a good part of this beautiful state. When I went to Oregon, people told me this and I said, you are kidding me? They are like, no, we are not kidding you we are for a Cascadia event. So I think the ESG factors building back better. It is a transformational point for the country. Covid has brought us to the table to make a difference, to build a different world. And I think broadband in some countries, broadband can be transmitted by satellite internet access. We can do that here to rural communities in this country, giving every child rural or within cities access to education the resiliency. We can no longer sit here and say, let us have the guest tax fund our programs, because guess what? We are going to migrate away from carbon fuels.
(37:07)
So we, at Oregan has been on the forefront of this type of innovation. We need monies from the EV charging infrastructure investments. These are all important initiatives. We are at the crossroads of the largest transformational change, in my opinion in probably over a century. And it is time we step up and figure out how there are probably nuances to this that are wrong in this bill, but we need to make it right, get it so that we can move to the future. The hybrid environment is going to demand it. Our society demands it. The success of states relies on its people. And if they are not adequately employed, adequately secure and safe, we are going to have problems in states and cities. So I think there is an opportunity here for this country,
Angelica Valencia (38:05):
And we are done. I am not running for election. That was great. That would incredibly would have ended there, that is not the end. So I feel a little like, okay but I think Emily actually alluded to this, that we were going to touch base briefly on politics. Clearly we are in a divided Congress so I think Emily was going to sort of give us her thoughts on what that will really mean for implementation going forward.
Emily Brock (38:35):
And so now we know it is a democratic senate and it is most likely a Republican house. And I going to tell you, I had a conversation in the house on Friday afternoon, and I bet if I call that person back on Monday, it would be another conversation. Because right now, a divided Congress gives the country a minute to breathe. When we see a unified Congress and with an executive, we see a lot of activity happening. We saw it in the 2017 Acts Act tax act. We saw it in art, but we saw it in IJA, although that was bipartisan. But so all these things kind of happen, and I kind of used the metaphor of the locomotive running down the train at full speed whenever it is just one party, you going to run and you going to figure out how to get on that locomotive. Now we have an opportunity to stop and think.
(39:33)
This actually was the quintessential bipartisan bill in a unified Congress. So everyone is motivated to make sure the success of this is laid out. I would say too, now that we are in a divided Congress, especially when it comes to, there is more time to talk to the rural smaller folks too, because rural, smaller folks are still spending arpa. They are like, well, we were waiting for the interim rules and then we are waiting for the final rules, and then we are going to wait for our city council to meet and then we are going to wait for, I mean, there is been a lot of foot dragging to spend those ARPA dollars. And now what I think it is going to happen is they can feel free to spend those ARPA dollars without fear of clawback. They have got an opportunity of just making sure that that happens and now they can revisit that eligibility. For IJA it guess if everybody can inhale and through the nose, out through the mouth, then we will have an opportunity for the I to finally come on the stage where it needs to go to be transformative. And I think a unique opportunity for what was actually paid up by a Democratic Congress. Now with a divided Congress, we have time to think about it and time to spend it.
Angelica Valencia (40:54):
I will not ask you the politics question, do not worry.
Justin Edwards (40:57):
Oh, I think she masterfully answered it.
(40:59)
I could not do it better than that.
Angelica Valencia (41:02):
But I do want to ask an implementation question. So what do you see as the one year plan in the two year plan in the three years with respect to implementation?
Justin Edwards (41:13):
Well, I think it is going to look a little different for particular projects as they roll out. There is just the summary is so large, they are over, I think 400 programs. Is that there? 400? Yeah. Programs in the bill. Some of these are going to be very quick wins for cities. I would say larger cities are going to experience the quicker wins. It is going to be a little bit harder to understand what is a shovel worthy project versus a shovel ready project from a smaller city perspective. But I think, and this is where this time to breathe element actually comes in place, it is going to actually give people a chance to sequence their planning sequence, their financing and their budgeting sequence, any projects they had in the stack already and how they can look at what the opportunities are looking forward. I am optimistic after hearing Emily. I hope I remain optimistic. I think we also need to start seeing some quick success stories coming from small rural communities to notice and share that kind of possibility.
(42:24)
Storytelling the implementation piece, what happens in transition in small communities. That is the part that I am sort like in the back of my mind. How do we build this into the training modules that we are doing? How do we talk about how to keep that project moving forward? Because it is a bit different than maybe the way a project was set up years ago when the last time they were done. Our organization is in it for the long haul. So we are planning on five years at least in here. So I think we have got 30 different semesters planned out. So we want to hit thousands of cities and hopefully we can get some of that money going. Yeah.
Angelica Valencia (43:07):
What about you, Emily?
Emily Brock (43:10):
Well I think in terms of just what was the question again? Can you remind me? I was going to carry away
Angelica Valencia (43:17):
With respect to implementation. What do you see as the one year, two year, three year?
Emily Brock (43:22):
Yeah, I think one year our goal is to make sure everybody knows where to find the information. I mean, honestly, that is definitely our first goal. Second year everyone is going to have to try to think about I, I am actually doing the math when Justin is talking about 200, 500, 900. And I am sitting here thinking, how many compliance and reporting webinars are we going to have to put on after the application webinars are done than you've got more compliance and reporting that has to be done. So we have got compliance and reporting that will throughout that five year cycle. I would say for those that are prepping to apply in five years, the appropriations are identical from year one through year six for many programs. And so the amount of dollars eligible throughout that period is equal. So if you are looking to apply in 2005 for issuers, the money is still there and the eligibility and the criteria, everything is still there.
(44:23)
You do have time to do that, but this is something GFOA talks to the hill about a lot. There are different time periods for finance and local governments. There is budgeting timeframes, there is audit timeframes. If you loop on another federal compliance and reporting timeframe, that is another timeframe. I mean, everybody knows the ARPA timeframe does not comport with the budget timeframe. It does not comport with the audit timeframe. And so looking at that five year window and understanding realistically when you can not apply and when you can make the best use of those funds is certainly something that remains equal throughout those six years.
Jacqueline Knights (45:04):
I think the question about is about the divided what we expect in the next year. I am hopeful and I am really optimistic that the newly elected individuals will look at this bill and fine tune it, tweak it, because there are a lot of aspects of it that says it is still evolving. And so I am hoping that we will have better definition of some of these metrics that are required. And probably if they listen to folks in the state of Oregon where they cannot use fund, provide some flexibility to direct funding to other areas that are needed for that geographic region. So I do think that it is optimistic. No one's going to take money off the table. They are just going to fine tune it and direct the resources appropriately. So I am looking forward to good change in the bill itself to clean up, clean it up.
Angelica Valencia (46:11):
I think we still got a couple of minutes for questions, but if anyone wants to do any closing remarks before we ask people to ask questions,
Justin Edwards (46:19):
Happy to open it up for questions.
Audience Member 1 (46:27):
There were some comments by former Henry, were speculated that mayors who or other city leaders who put in this time and effort to build these proposal or going to want to go ahead of that project, whether or not they win the federal grant. Have you got any feedback you working with people in that?
Justin Edwards (46:45):
There is certainly an element of that for sure. I think we were talking about this earlier. I mean a lot of them are elected on these promises as well. A lot of the folks that we are working with are sometimes volunteer. They are city managers. They are like a hired sort of coordinator in this process. But we ask for broader sort of government participation. There are some programs though that I think they would be almost impossible to do because of the levels of funding that they represent. I am thinking of the smart transportation one. That application deadline just passed. It is a very niche Department of Transportation grant opportunity to embed kind of pre scaled phase technology like sensors on vehicles and things. We had one person in Nashville and New Hampshire, she basically said, we worked way too cutting edge for this particular one. So they could not pursue on their own without the funding. I think some of the more core built environment bridges and roads, they will go ahead. Yes. That is the nature of their business anyway. I think this is just an accelerator for them to get it done faster and more comprehensibly.
Emily Brock (48:04):
But theoretically those are promises. And we have always talked about this in Congress where there is a red, a ribbon, and a big pair of scissors. Nobody loves what is underground. Nobody loves the dirty water. Nobody loves until broadband has come along. So we notice something in 2020 that we could not live without as an economy. And that is reach a broadband. And I know that Oregon focuses on that. But what happened in ara, the American Recovery Plan back in 2009, 709, that was the backbone. So the backbone got built and we have got this lit broadband, and then it just did not go middle mile and it did not go last mile. And so we realized we spent a whole bunch of money on this sort of lit infrastructure. And again, underneath the ground, not sexy under. And then boom, all of a sudden now you can run on broadband promises, which is kind of cool too. A nice opportunity to highlight things that do not necessarily need a ribbon cutting theoretically.
Justin Edwards (49:16):
Is there another question? I think? Yeah.
Audience Member 2 (49:19):
Yeah. Hi, it is Kurt. For S&P I guess for any panelists, but maybe Emily is directed to you first. There is a six year horizon to these monies. Is it possible to actually get all that money out the door in six years and what happens if they can not?
Emily Brock (49:37):
It is a statutory requirement right now to do that. And if you are asking, what if another congress a hundred 19th comes along and says, Nope, we are going to claw back those monies that there is an annual appropriations that now has been set into law and Congress has to appropriate it a third with annual appropriations, a third with Highway Trust Fund, which again, another sort of disputed source. And then the fundraising from Congress has to have. So I mean there is a lot of moving parts beyond this divided Congress that still has to be synchronized in order for the deployment of this program to continue. So I do not say, obviously we do not know what's going to happen in the future but it has been federally appropriated at this point, assigned to be federally appropriated.
Audience Member 2 (50:40):
And could Congress extend the time period if they, they felt like the statute was not going to allow them an opportunity to obligations.
Emily Brock (50:48):
So that would be an act of Congress. Not to put it metaphorically, but it would have to be an act of Congress, which requires 60 Senate votes. So it would of course be a whole other conversation about how can we change. It was kind of like the ARPA or Cares decision when they said, well, can we extend this another year or three years? Well, you have got to get all of Congress to come together in order to make that happen. So the answer is yes, if you can find 60 senators to vote for it.
Angelica Valencia (51:27):
Any more questions? I think we are out
Jacqueline Knights (51:29):
Of time. If I might just say the transportation bill I believe has been around since 1956. It is not going to go away. There are many years in the Obama years, I think there was two or three years where it was not authorized. It was a reauthorized, but they had continuing appropriations based on the prior year appropriations. There is nothing you can do with the transportation funds. The fact that all these other items are now built into that package, it makes it a little nuanced, I believe. And so I do think that those other items would need significant support at the federal level to bring them forward. But the transportation component, I think is unsolid.
Emily Brock (52:17):
Right? that is true. That component is the Fast Act component. Yep. Yep.
Angelica Valencia (52:24):
I think I do not see any more questions and I think we are officially out of time too. Well, thank you everyone for joining us.