How to Spend Federal Money

A Brief Overview of Guidelines for Federally Funded Project Implementation

There is more infrastructure funding available to communities than ever before.
Signed into law in 2021, the Infrastructure Investment and Jobs Act (IIJA) provides funding for a wide range of infrastructure projects, which are divided into five categories of improvements: transportation, water, energy, broadband, environmental infrastructure, and resilience and disaster mitigation. The bill increases federal spending on infrastructure projects by $550 billion over the next 10 years. This influx of financial resources means that many projects that were previously ineligible or left unfunded may now receive funding and many communities are being exposed to the guidelines and restrictions of federally funded projects for the first time. While specific guidelines may vary depending on the nature of the project and the agency responsible for administering the funds, there are some general guidelines that communities awarded federal funds should follow:

Federal funding takes many forms.
Project funding may be in the form of a grant or award of many names, and as the recipient, you need to know the name of the program, the awarding agency, and the source for the funds. Transportation funds, for example, may be awarded through the Ohio Department of Transportation, but are actually federally-allocated dollars for certain programs such as the Highway Safety Improvement Program. In addition, all agencies have different nuances in requirements for obtaining a release of funds

Consultant procurement is a fair process.
Quality Based Selection (QBS) is the process by which communities procure a professional services consultant through an open and transparent process. QBS requires the community to publicly issue a Request for Qualifications (RFQ) through its website, newspaper notice, or project search engine such as BidSync or GovWin. Responses are then reviewed and officially ranked based only on qualifications. Project fees or price quotes are not included with the response for an RFQ and cannot be the basis for professional services selection.

Federal funding comes with requirements for transparent and accountable use of funds.
Communities must ensure that their projects comply with all specific federal funding requirements. This may include meeting certain eligibility criteria, adhering to specific funding allocations, and following any regulatory guidelines and reporting guidelines set forth by the relevant federal agencies or federal programs. Communities are expected to use federal funds transparently and accountably. This includes maintaining accurate records of expenditures, providing regular updates on project progress, and adhering to any reporting requirements specified by the funding agencies.

Projects must address environmental and social considerations.
The National Environmental Policy Act (NEPA) is a cornerstone environmental law enacted in 1970, serving as the fundamental framework for integrating environmental considerations into federal decision-making processes, including infrastructure projects. The act mandates an analysis of a project’s impacts to the human and natural environment, and compliance with an array of other federal laws. Projects must demonstrate an analysis of alternative actions and allow for public participation in the decision-making process. NEPA compliance includes environmental assessments, engaging with stakeholders and public involvement activities, and mitigating any adverse effects on the environment or local communities.
It is vital to consider and initiate the NEPA process as early as possible in the project timeline due to the fact that both environmental and social considerations may have design impacts. Additionally, there typically are other agencies, such as the US Fish and Wildlife Service, that will need to conduct reviews and provide approvals prior to NEPA clearance. In addition, Final Design and Right of Way acquisition cannot be started until environmental clearance is obtained.

Collaboration and partnerships provide a win for you and for your project.
Collaboration and partnerships with other stakeholders, including local governments, businesses, nonprofit organizations, and community members, can enhance the success of the project. In addition to being a key element of the NEPA process discussed above, a robust public involvement program can assist in community buy-in and ownership of a well-communicated project.

These projects require effective project management.
Effective project management is essential for federally funded projects. If communities are not familiar with the federal requirements, it is critical to either hire a knowledgeable consultant with federally funded project experience, or ensure that in-house staff is well-versed in the requirements of the project’s specific funding agency. An experienced consultant will help communities develop clear project plans, establish realistic timelines, and ensure the project meets all obligations in order to obtain the awarded funds.

Overall, communities awarded federal funds from any agency or program should approach their projects with a commitment to transparency, accountability, equity, and efficiency to ensure that the funding is used to address critical infrastructure needs and promote economic growth and prosperity. The penalty for not complying (loss of funding, project delays, public frustration, etc.) may jeopardize future federal funding opportunities.

For more information on implementing your project, contact our NEPA and federally funded project experts Christy Pirkle at 614.775.4516 or cpirkle@emht.com, or Mike Krokonko at 614.775.4509 or mkrokonko@emht.com.