Late on Monday, President Donald Trump released multiple executive orders, two of which could impact the roads and bridges construction industry.
Trump directed agencies to cease funding for two major Biden-era laws, the Infrastructure Investment and Jobs Act (IIJA) and the Climate Reduction Act. This could disrupt a broad array of roads and bridges, transportation and energy projects, potentially halting initiatives that are already creating jobs in the country (especially in states that Trump won in November’s election).
The order commands agencies to “immediately pause the disbursement of funds” under former President Joe Biden’s 2021 IJJA and his 2022 Climate Reduction Act, according to a report from Politico. The order could impact billions of dollars in funding for projects that states have already begun working on.
Congress appropriated $144 billion in direct spending under the climate law, known as the Inflation Reduction Act, and $836 billion under the IIJA, according to Politico.
Federal agencies have obligated $378 billion in infrastructure law dollars as of Nov. 30, including $162 billion that the government has actually paid out, according to federal spending data.
Projects funded by the infrastructure law could be especially vulnerable to any effort by Trump to halt obligated money.
Bobby Kogan, senior director for federal budget policy at the liberal Center for American Progress, said President Trump’s new order on spending could lead to the government not paying money that it has promised.
“What they said here, ‘no new disbursements,’ means it doesn’t even matter if they already signed. No money can go out the door,” Kogan said.
“That causes us to be in breach of our contracts,” he said. “The United States is not allowed to default” on contracts.
Source: Politico, Bloomberg
