U.S. DOT Unveils Build America Bureau

by Nossaman LLP
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U.S. Transportation Secretary Anthony Foxx, senior Department staff, and even an official from the White House gathered at U.S. Department of Transportation headquarters on July 20th to celebrate the grand opening of the Build America Bureau. After sharing a cake emblazoned with its logo, the dignitaries led a tour through the Bureau’s new office space in what used to be the library, replete with glass offices, motorized desks, and curved computer monitors. Compared to the cubical-farm offices of the modal administrations, the Bureau is clearly something different and new, and that theme made its way into many of the speeches preceding the tour.

Section 9001 of the Fixing America’s Surface Transportation (FAST) Act (P.L. 114-94) created the Build America Bureau to provide a one-stop-shop for project sponsors wishing to navigate the Department’s credit programs and environmental permitting requirements. The Bureau is located within the Office of the Secretary and serves three primary functions:

  1. Administer the application processes for the Department’s credit programs—TIFIA, RRIF, and amount allocation for PABs—and the FASTLANE grant program.
  2. Work with the Department’s modal administrations and outside stakeholders to develop and promote best practices relating to innovative financing and procurement.
  3. Accelerate environmental permitting for complex projects.

Even though the Bureau is open for business and the expectations of Administration officials are high, key issues remain unresolved.

First, how will U.S. DOT staff the Bureau? Many leadership positions in the Bureau are filled, but there is still a question as to who will take the laboring oar for the Bureau’s core functions. The FAST Act gave the Bureau authority to move relevant offices (i.e., FTEs and corresponding budgetary authority) from the modal administrations, but how much and to what extent that actually happens remains to be seen. If the modal administrators push back on an outright re-organization of the Department with the TIFIA and RRIF offices moving up to the Bureau in their entirety, that could hamper the efficacy of the Bureau, which leads to the next issue.

Second, congressional authorizers provided explicit authority for the Bureau to administer the application processes for TIFIA, RRIF, PAB allocations, and FASTLANE grants, but what will the Bureau do when it comes to overseeing and managing the portfolios of these programs? The FAST Act is specific in what authority the Bureau has on paper, but whether Secretary Foxx chooses to move the ongoing work of these credit programs to the Bureau is another issue entirely.

Third, many industry professionals are wondering how much of a difference the Bureau will actually make. The Bureau is a great concept, but could it result in an even murkier, more bureaucratic process for project sponsors to navigate? With the right vision and a dedicated staff, the Bureau could truly revolutionize the way project sponsors access federal credit programs, but implemented poorly, this office could add additional time, effort, and resources to an already protracted process.

Finally, what impact will the Presidential election have on the future of the Bureau? As a legal entity created by the FAST Act, the Bureau will still exist in the next Administration, but how the next President and Secretary of Transportation choose to use the Bureau could vary widely. One perspective could be to view the Bureau as an office with almost unprecedented statutory carte blanche to streamline, accelerate, and reform the credit programs and environmental permitting requirements administered by the Department. The next Administration could recognize how meaningful the Bureau could be and take the baton from Secretary Foxx.

On the other hand, the next Administration could view the Bureau as a layer of bureaucracy unnecessarily duplicative of the functions better served by the modal administrations. Should such be the case, the next Administration could retain the Bureau’s existence on paper while decentralizing its functions back to the modes.

The Build America Bureau provides an historic opportunity for U.S. DOT to promote the accessibility of its loan programs and to accelerate the environmental permitting process for complex infrastructure projects. The appropriate disposition of these issues will be critical to the successful fulfillment of its statutory mandate.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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