More Federal Dollars Strengthen State Travel Grid

Pandemic relief funds, record reallocation sent to Caltrans, local agencies

Transportation funding for Caltrans and local entities in California got a big boost from the federal government in 2021, and that inflow of money to improve the state’s travel network is continuing in 2022.

Unanticipated revenues, which consist of money not budgeted at the start of fiscal years, arrived in the form of COVID-19 relief funds approved by Congress in 2021, and through the “August Redistribution” that divides unspent federal transportation funds among states each year.

Caltrans and its regional transportation partners netted more than $1 billion from the Federal Highway Administration (FHWA) and the Federal Transit Administration (FTA) last year to recoup expected losses in revenues and fares from the effects of the pandemic.

COVID relief dollars disbursed

The first distribution of money came in the winter of 2020-2021 from the passage of the Coronavirus Response and Relief Supplemental Appropriations Act for highway infrastructure programs. California received $911.5 million, with the California Transportation Commission (CTC) distributing about $547 million of that amount to Caltrans and almost $365 million to local transportation agencies in a 60/40 split.

The CTC conducted several virtual workshops in spring 2021 to take input on how federal relief funds should be spent. For Caltrans’ share, there was broad consensus to route most of that money into the State Highway Operation and Protection Program (SHOPP), Caltrans’ primary “fix-it first” fund dedicated to travel network repair and rehabilitation. The SHOPP is a critical program for the Road Repair and Accountability Act of 2017 (SB 1).

Regional transportation agencies received $365 million to make up for revenue shortfalls during the pandemic.

Those agencies got additional money through a supplemental relief program overseen by the Federal Transit Administration (FTA). California transit agencies that serve rural or aging populations received $74.4 million in the winter of 2020-2021, money directed to Caltrans’ Division of Rail and Mass Transportation for distribution. Another $34.9 million arrived from the FTA in April 2021 to offset agencies’ maintenance and operational losses during the pandemic.

Past storm repairs reimbursement

In the latest round of good news for California transportation needs in 2022, Caltrans received word from FHWA that California will get $595 million as reimbursement for emergency travel route repairs that date back to the 1990s.

The state typically receives about $100 million annually as the federal government’s share for the costs incurred from storm damage repair of roadways. The true cost has been higher, however, with state and local governments picking up the lion’s share of those repair bills.

The $595 million will cover the federal government’s obligation for road damage caused by 30 past storm events in California.

Historic federal infrastructure funding

On November 15, 2021, President Biden signed the Infrastructure Investment and Jobs Act (IIJA), representing the biggest federal investment in our nation’s transportation infrastructure in a generation. Just on guaranteed funding alone, California will receive roughly $40 billion over the next five years for highways, bridges, public transportation, airports, safer streets and electric vehicle charging. The IIJA is expected to provide almost $1.9 billion in additional federal transportation funding for California in the upcoming 2022-23 fiscal year, according to calculations by Caltrans’ Division of Budgets. The portion dedicated to the state transportation network, maintained by Caltrans, will be 60 percent, while regional transportation agencies will receive 40 percent of the increased funding, consistent with historical funding splits.

The money will be apportioned as part of the state budget process.

State Budget

In early January, Gov. Newsom released the proposed state budget for the 2022-23 fiscal year, which represents the initial step in the budgetary process that is scheduled to wrap up in June. The proposed budget for Caltrans is more than $20 billion, which reflects an increase of almost $2.7 billion (or 15.5 percent) from the current FY 2021-22 budget, and represents the highest-ever proposed budget for the department.

Learn more about the governor’s budget proposals for Caltrans by visiting the state Department of Finance’s webpage.

Source: Caltrans Division of Budgets