IIJA lessons learned: Five actions to access infrastructure grant funding
In November 2021, the President signed into law the historic $1.2 trillion bipartisan Infrastructure Investment and Jobs Act (IIJA) that has resulted in hundreds of funding opportunities to improve our nation’s highway and bridges, transit systems, railroads, broadband networks, energy grids, drinking water and more. What at first appeared to be a great opportunity to fund projects immediately has turned out to be slower and more complicated now that we are over a year into this five-year (2022–2026) legislative program.
Federal agencies responsible for overseeing these multiyear funding programs for large, complex projects have taken longer than expected to open application rounds and distribute funds. Some programs weren’t announced in 2022, but instead announced as larger opportunities in 2023, with first-year and second-year funding combined. At the same time, some IIJA funding is passing through states with state-led grant programs, making it difficult to track or even slower to distribute. Finally, some agencies have split or combined sections of IIJA funding in ways that weren’t originally anticipated.
So, what does this mean for utilities, municipalities and tribes that still want to pursue IIJA funding?
IIJA lessons learned in year one
It means that grant opportunities have been delayed, more difficult to track and announced in complicated ways. Notable examples that are most relevant to public power include:
GRIP combines three sections of the IIJA into one large grant opportunity with three topic areas that have different deadlines and application requirements. All topic areas require a concept paper followed by a full application, if encouraged to apply. These grants, especially topic area 1, are highly competitive.
- Topic Area 1 - Grid Resilience - IIJA Section 40101(c): For projects that will strengthen the grid against extreme weather and natural disasters, with 30% set aside for small utilities
- Topic Area 2 – Smart Grid – IIJA Section 40107: For projects that use technology to increase flexibility, reliability and resilience
- Topic Area 3 – Grid Innovation – IIJA Section 40103(b): For projects that innovate and improve upon grid reliability and resilience locally, regionally and inter-regionally
Formula grant allocates pre-determined dollar amounts to states and tribes, which will then distribute the funds via state-led and tribal-led funding initiatives. This funding comes from the same section of IIJA, 40101(c), as GRIP Topic Area 1, and can be used for the same type of grid resilience activities. Because of the delay in kicking off this program and the deadline extensions already provided, DOE is issuing year one and year two funding allocations together. States and tribes have started to receive the funding on a rolling basis this summer. Municipalities and utilities, you should keep an eye out for announcements coming from your states.
Funding was anticipated to be one program but has turned into three different funding opportunities for rural and remote communities (defined by populations of 10,000 or less) to improve resilience, reliability and affordability of energy systems:
- Energizing Rural Communities Prize: $300,000 cash prizes to develop partnership plans or innovative financing strategies to help rural and remote communities improve their energy systems and integrate clean energy
- ERA Funding Opportunity: Traditional grant opportunity with a cost-share requirement to fund community or large-scale energy demonstration projects that address regional energy challenges
- ERA Fixed-Award: A grant opportunity designed to support small, community-drive clean energy and energy resilience projects with no cost share, an easier application process, and simpler compliance requirements
The two CFI grant programs — Corridor Charging and Community Charging — were announced together, and applicants could be considered for both by submitting only one application.
Five actions to access IIJA funding
While new grant announcements have varied widely from projected timelines, federal agencies still only provide 30 to 90 days between the notice of opportunity and the submission deadline. In other words, despite the delay in rolling out the funding, application timelines remain tight. Large-scale organizational planning is key for public sector utilities, municipalities and tribes seeking to leverage transformative infrastructure funding. The first year of IIJA has provided new insights into best practices for mobilizing your team, using your resources strategically and developing competitive proposals on short notice:
- 1. Funding strategy
- 2. Project design
- 3. Grant lifecycle
- 4. Teamwork
- 5. Evaluate
Create an adaptable funding strategy.
With many new programs announced for the first time this past year, it’s important to conduct research, develop a plan and match potential opportunities with your priority projects. This process enables you to evaluate your capacity for grant pursuit and better strategize how to allocate your attention and resources to programs that best fit your needs. Though this first year provides more information on what to expect in coming years, it has also been highly unpredictable. Monitoring broader program office updates for opportunities you are pursuing helps you make informed decisions about submission priorities. Be open to adapting your strategy in an ever-shifting landscape.
Address funding priorities through holistic project design.
Grant programs are mission-driven, with clear goals, priority populations or geographies, and desired outcomes. Successful project design marries your needs with the program’s goals. Even the most technical narratives should get creative with their storytelling and translate specific project outputs into short-term and long-term impacts that speak to this mission. Considering specific IIJA priorities – like serving disadvantaged communities through Justice40, buying domestically, creating more jobs and building climate resilience – will also strengthen your project’s alignment with competitive selection criteria. Think carefully as well about what makes your proposed project innovative, whether you’re using new technologies or creating a new model for solving a problem that others in your region can adapt and use for broader impact.
Consider the full grant lifecycle.
During proposal development, the initial focus understandably falls on securing the funds. However, it is equally essential to set your organization up for post-award success during the application stage. The grant proposal and its many components, such as the work plan, objectives, evaluation metrics and budget, will serve as the blueprint for measuring post-award progress and set important perimeters for project completion. Intentional project design can increase the strength of your proposal – aligning with key evaluation criteria such as demonstrated organizational capacity, likelihood of work plan completion and strongly justified budget estimates. It also can lay a strong foundation for successful project implementation, reporting and compliance in the post-award period.
Build a strong team.
Federal grant proposals involve many moving parts, from technical volumes and budget justifications to workforce development plans and community partnerships. The strongest applications are written collaboratively using the full range of staff expertise. Grant professionals should work with project leadership, subject matter experts, financial managers and HR representatives to gather information and insight into reasonable timelines, budgets and internal policies for implementing the proposed work. It is also helpful to consider internal capacity early on to evaluate whether you’d like to seek additional partnerships, consultant support or other cost-share providers.
Re-strategize, revise and resubmit.
Remember, these grant programs will continue for at least four more years of IIJA funding, and some will continue beyond this timeframe through other funding sources. If your initial grant application is not awarded, its preparation is not wasted effort and can help make your next proposal even stronger. Most federal agencies will provide evaluation feedback upon request, and you can use this input to develop a strategy to improve areas of weakness. Revising and resubmitting an application means less additional effort upfront and a higher chance of ultimate success.
What to do next
With the IIJA lessons learned in year one and five recommended actions to access funding in mind, the next step is to assess your organization’s internal capacity to pursue and manage grants. In many cases, you may want to consider hiring dedicated staff or outsourcing grant writing and compliance efforts. Baker Tilly can help you navigate this complex terrain, develop funding plans and pursue IIJA opportunities with confidence. Contact our grant professionals to get started.
