How the Infrastructure Investment and Jobs Act Will Impact Construction in 2024

A hundred feet beneath the Hudson River lies a vital artery in the nation's transportation network that, should it fail, could bring 20 percent of the nation’s gross domestic product to a screeching halt.

The centuries-old North River Tunnel has been subject to constant flooding for the better part of a decade. But $3.8 billion in phased funding is set to fast-track the construction of a replacement tunnel—and rehabilitate the old one.

It’s a prime example of the magnitude and impact of the Biden administration’s ambitious $1.2 trillion Infrastructure Investment and Jobs Act (IIJA). One of the biggest public works investments in American history, the legislation is poised to rejuvenate key portions of the nation’s crumbling infrastructure over the next decade.

The IIJA’s effect on the construction industry has already been profound. Construction spending has reached an all-time high, with public construction spending at $455.1 billion in November 2023. With this level of funding up for grabs, it's imperative for construction leaders to understand the scope and implications of this historic legislation—and what they can expect in 2024.

The IIJA by the Numbers

The IIJA earmarks $550 billion for “new” investments and programs aimed at enhancing connectivity, promoting economic growth, and creating more resilient and sustainable infrastructure. Since its passage in 2021, it has funded more than 40,000 infrastructure projects.

The largest sector investments have been in roads, bridges, and similar major projects, as well as passenger and freight rail. The former is set to receive $110 billion, and the latter is slated to get a boost of $66 billion over the next five years. Other significant areas of funding include:

• Safety: $11 billion toward highway and pedestrian safety programs, as well as energy pipeline safety and repair.
• Public Transit: $39.2 billion toward funding transit system repairs, system expansions, clean transit options, and accessibility.
• Broadband: $65 billion toward expanding access to broadband infrastructure.
• Ports and Waterways: $16.6 billion toward waterway and coastal infrastructure, inland waterway improvements, port infrastructure, and land ports of entry.
• Airports: $25 billion toward runways, gates, and taxiways, as well as terminals, concessions, and multimodal connections.
• Water Infrastructure: $55 billion toward lead service-line replacement, mitigating PFAS (per- and polyfluorinated substances) contamination, supporting water infrastructure in tribal communities, and completing currently authorized Indian water rights settlements.
• Power and Grid: $65 billion toward grid reliability and resiliency, critical minerals and supply chains for clean energy technology, clean and renewable energy technologies, and energy demonstration projects.
• Resiliency: $47.2 billion for cybersecurity to address critical infrastructure needs, waste management, flood and wildfire mitigation, drought, coastal resiliency, ecosystem restoration, heat stress, and weatherization.

Bridges: A Closer Look

To date, the IIJA has helped jumpstart over 2,800 bridge repair and replacement projects across the United States. This funding comes at a critical time: 7.5 percent of the nation’s bridges are considered structurally deficient, and the nation’s backlog of repairs has climbed to $125 billion.

Zooming in, that IIJA funding has already made its way to the nation’s third-largest city, where $144 million will go toward improvements to four bridges over the Calumet River on the South Side of Chicago. Repairing the four century-old drawbridges, which lift an average of 5,000 times per year, will help keep cargo moving through the Illinois International Port. Work is expected to begin in early 2024.

Internet for All: A Closer Look

One of the IIJA’s purported goals: bring access to free or discounted high-speed internet service to more than 21 million low-income households, thus closing the “digital divide” for underserved Americans.

To that end, the bill appropriated $42.5 billion in funding for last-mile broadband infrastructure deployment under the Broadband Equity, Access, and Deployment (BEAD) Program, including $1 billion through the Enabling Middle Mile Broadband Infrastructure Program and $3 billion via the Tribal Broadband Connectivity Program.

These grants can make a real impact on tribal lands within the US, which have been the most difficult areas for consumers to obtain reliable broadband. Arizona, for example, received $1 billion in federal funding to build out infrastructure on tribal lands—as a direct result, more than 33,000 homes will gain internet access. In 2024, we can expect many of these projects to break ground.

Navigating the Path Ahead

Construction leaders gearing up to seize IIJA opportunities should consider the following over the coming year:

• Grants expertise will be important: $180 billion of IIJA funds will be provided through a competitive grant process that will allot funds based on the strength of applications, rather than on other metrics like population size. To receive funding, states and local governments will have to assess which programs to apply for and craft applications that demonstrate a clear vision and accountability.
• IIJA funds won't be an immediate windfall: While competitive grantmaking is on the rise, as of November 2023,80 percent of all competitive funding had yet to be awarded. This has been in part due to the sheer complexity of the bill—it has over 450 unique funding categories. Because the responsibility for securing project funding falls primarily on state and local governments and agencies, construction leaders should be thinking in years, rather than months.
• Politics could affect project funding: Construction companies will have to stay abreast of the evolving political landscape—the outcome of next year’s presidential election could reshape how federal, state, and local governments cooperate with each other.

A Bright Future for Infrastructure

With billions of dollars pouring into over 4,500 communities across the nation in 2024, construction leaders have plenty to look forward to. The IIJA is a once-in-a-generation opportunity, and if construction companies play their cards right, they’ll be able to secure contracts, break ground on new projects, and finish longstanding ones.

Berkeley Research Group is a Litigation Section Premier Sponsor. This article should not be construed as an endorsement by the American Bar Association.