IIJA - Infrastructure Investment and Jobs Act Overview


The Infrastructure Invest and Jobs Act (IIJA), also colloquially called the "Infrastructure Bill", was a $1.2T spending bill passed in November 2021. Of the $1.2T in total appropriations, $550B was new funding. The Biden Administration summarizes the bill as:

"The legislation includes around $550B in new federal investment in American's roads and bridges, water infrastructure, resilience, internet, and more. The bipartisan Infrastructure Investment and Jobs Act will grow the economy , enhance our competitiveness, create good jobs, and make our economy more sustainable, resilient, and just."

IIJA Overview

The Infrastructure Bill is organized into several large subsections. It may be helpful to think of each subsection as a separate entity, with its own funding amounts, rules, and processes. The graph below shows the distribution of new funding in the legislation, on top of already appropriated dollars.


Infrastructure Bill - New Spending by Category

Defining Infrastructure Categories

Funding in the Infrastructure Bill is categorized into broad groups corresponding to certain use cases. While some of these categories may be self-explanatory, others are not so straightforward. This list below shows how these categories are defined in the IIJA.

  • Transportation - Roads and bridges, rail, public transit, airports, ports and waterways, transportation safety research, green and electric vehicles, reconnecting communities

  • Water - Drinking water infrastructure, wastewater infrastructure

  • Broadband - High-speed and reliable internet connectivity; a focus on rural, underserved, and "last mile" communities

  • Resiliency - Developing, implementing, or revising a cybersecurity response plan; responding to immediate cyber threats; not to pay ransoms

  • Power & Grid - Infrastructure used to create, distribute, and manage electricity

  • Environment - Protecting natural resources such as water, reducing pollution, protecting wildlife and "natural infrastructure"

How is the Money Distributed?

There are three primary ways IIJA funds will be distributed from the federal government to state and local agencies.

  1. Direct funding from the federal government to state, local, and tribal governments

  2. Direct funding from the federal government to any entity (e.g. private)

  3. Sub-grants from state governments to other entities

The graphic below shows an example of how money flows from the federal government to different levels of state and local agencies, either directly or through sub-grants.

Information Technology and the Infrastructure Bill

Key Concept - Is Tech the End Goal or the Medium?

Technology is both the end goal and the medium for accomplishing other goals in the IIJA. Certain parts of the bill provide funding for specific technology purchases (e.g., subsidizing broadband, electric vehicles, cybersecurity, intelligent transportation software). Other parts of the bill provide funding for projects whose main goal is not necessarily technology (e.g., highways, airports, power grid, school buses). However, these opportunities are still ripe for technology. For example, this would include opportunities to procure advanced traffic software to monitor highways or electronic ticketing systems and devices for public transportation.


Cybersecurity

IIJA creates a new federal grant program administered by the US Department of Homeland Security - the State & Local Cybersecurity Grant Program. This program will provide $1B in grants for public agencies below the federal level to develop, implement, or revise a cybersecurity plan or address an imminent threat. The majority of this funding will flow through state governments, who are then required to distribute at least 80% of their funding to lower-lower governments. Other provisions of the IIJA contain cybersecurity provisions - especially those affecting transportation, rail, power & grid, and water.


Putting It All Together

The collapsible list below organizes critical information about each of the Infrastructure Bill's major use case categories - including applicable agencies, uses, tech alignment, and a funding example.

Transportation

Water

Broadband

Resiliency

Power & Grid

Environment

Final Considerations

  • Guidance takes time - Federal agencies must administer new grants and design new programs. States and localities must identify and execute new projects all amid continuing efforts with CARES Act and ARPA programs.

  • Funding will not flow consistently over time - The pace at which federal funds area released will vary. Some funds may not begin flowing until late 2022.

  • Funding will be available beyond state governments - Localities and the private sector will be eligible for some of the programs - either receiving sub-grants or directly from the federal government.