OIG: USDOT faces challenges in infrastructure bill implementation

The U.S. Department of Transportation faces "significant challenges" as it begins to implement the Infrastructure Investment and Jobs Act, the USDOT Office of Inspector General (OIG) said in a new memo.

In an Oct. 5 memo to U.S. Transportation Secretary Pete Buttigieg, USDOT Inspector General Eric Soskin laid out the various challenges the department will have to address as it rolls out the $1.2 trillion infrastructure law, which Congress passed in November 2021.

“The volume of IIJA funds, coupled with the creation of new programs and priorities, present a number of significant implementation and oversight challenges,” Soskin wrote.

Soskin laid out three key points:

• USDOT needs to effectively identify, assess and develop plans to mitigate risks to achieving its goals, particularly the heightened risk of fraud;
• The department needs to recruit, develop and retain the necessary workforce to implement and oversee IIJA programs while also effectively coordinating with key stakeholders to overcome their immediate administrative challenges; and
• The department needs to enhance and, in some cases, establish effective and efficient processes for awarding and administering IIJA grants and overseeing grantees’ compliance with federal requirements.

The infrastructure bill authorized $660 billion in funding for new and existing federal transportation programs and is expected to be implemented through fiscal-year 2026. Out of the total, $383 billion is reserved for contract authority — specified amounts that the department can expend in each of the years covered by the law — while $184 billion is designated for USDOT program appropriations, according to the memo.

The White House Infrastructure Implementation Team, which is charged with carrying out all aspects of the bill, has set timeframes for various goals. Rail-related goals include one year for investment in 15,000 new subway cars, buses and ferries and one year for investment in 75 new “Made-in-America” locomotives and at least 73 intercity trainsets to be used by Amtrak.

Through an executive order, President Joe Biden has also set certain priorities for IIJA implementation, including investing efficiently and avoiding waste; increasing the competitiveness of the U.S. economy through Buy America requirements; and building infrastructure that is resilient and helps combat climate change, according to the memo.

Fraud and waste risks are particularly important to USDOT, Soskin wrote. While 10% of federal funds spent on surface transportation, transit and highway safety research and development is directed toward small businesses owned and controlled by socially and economically disadvantaged individuals, disadvantaged business enterprise fraud poses significant risks.