March 16, 2017

Administration proposes 13-percent cut in DOT FY '18 budget, end to funding for TIGER grant program

White House says funding available under other programs.

By Mark B. Solomon

The Trump administration today proposed a $2.4 billion cut in the Department of Transportation's fiscal year 2018 budget, with nearly $500 million in savings coming from eliminating a popular grant program called "Transportation Investment Generating Economic Recovery," more popularly known by its acronym of "TIGER."

Under the administration's proposal, DOT's FY 2018 budget would be reduced to $16.4 billion, a 13-percent cut from FY 2017 levels. The proposed reduction "eliminates programs that are either inefficient, duplicative of other federal efforts, or that involve activities that are better delivered by states, localities, or the private sector," the administration said in its budget request. By law, it is Congress' role to set the budgets of federal agencies. Funding would be eliminated for long-haul rail service provided by Amtrak, the national passenger rail corporation. In addition, DOT's "Essential Air Service" program, created decades ago to subsidize airline service to rural airports that otherwise might not receive scheduled flights, would lose its funding under the budget proposal. The budget also calls for a multi-year funding plan to shift the Federal Aviation Administration's (FAA's) air traffic control functions to an independent, non-governmental entity.

For freight interests, the biggest hit would be felt with the proposed demise of the eight-year TIGER program, which has enjoyed bipartisan backing in Congress. During her confirmation hearing in January, Transport Secretary Elaine L. Chao said the TIGER program constituted the "one area of agreement" among all the Congressional members she met with, according to published reports. She made no promises as to its continuation, however, according to the reports. Chao is married to Senate Majority Leader Mitch McConnell (R-Ky.)

Established in 2009 during the Great Recession, the program leverages funding from multiple sources, including the private sector, to provide grants to projects that would have difficulty obtaining capital through the traditional federal funding process. Since its inception, the program has funded $5.1 billion for 421 projects at state and local levels, according to DOT. The 2016 TIGER round leveraged $500 million in federal funds to underwrite $1.74 billion in projects, DOT said on its web site.

Projects containing a strong freight component have received 42 percent of available funding, about $2.25 billion, since the program was created, according to an analysis by the Coalition for America's Gateways & Trade Corridors (CAGTC), a freight advocacy group.

Grants available under the program are competitively bid, and demand has exceeded the supply of funds by a wide margin. Since the program's launch, about 7,300 applications have been submitted, totaling a requested $143 billion in funding.

The administration defended its actions by saying federal programs already exist that could provide funding for projects that might otherwise have utilized the TIGER program. In addition, Congress provided $900 million in annual grant money for "nationally significant" freight and highway projects under the five-year federal transport-spending bill signed into law in late 2015, the White House maintained.

Kathryn B. Thomson, who served as DOT general counsel during the Obama administration and is today an attorney in private practice, said she was surprised by the move to zero out TIGER funding. Thomson noted the program's bipartisan popularity, and said the decision directly conflicts with President Trump's promise to invest heavily in infrastructure improvements.

The TIGER program is unique in that it allows local government to compete for funding that otherwise goes only to states, Thomson added.

About the Author

Mark B. Solomon
Executive Editor - News
Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.

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