Among the deluge of actions and executive orders signed last week, Trump directed government agencies to “immediately pause the disbursement of funds appropriated through the Inflation Reduction Act of 2022 [IRA]… or the Infrastructure Investment and Jobs Act [IIJA].” The two laws have directed billions of federal dollars to states and local governments for a range of projects, including highway expansions, electric vehicle infrastructure, water system upgrades, and investments in manufacturing.
According to an article in Governing Magazine, it’s unclear what the immediate impact of the executive order will be, given that the spending has been approved by Congress. Legal precedent holds that the president cannot block approved congressional spending. But even a slowdown in federal payouts for planned infrastructure projects could have ramifications for state and local budgets.
“The safe move [for agency administrators] is to be cautious here and listen to the letter of the executive order,” Adie Tomer, a senior fellow at Brookings Metro, was quoted as saying in the article. “There is reason to expect that many states and localities, irrespective of their cash reserves and risk tolerance, are going to stop projects or halt them temporarily. And that could have real costs.”
Jim Tymon, executive director of the American Association of State Highway and Transportation Officials (AASHTO), was also referenced in the article. While the language of the executive order appears to apply to all programs in the IIJA, which includes the vast majority of highway funding allocated to states. Tymon believes, based on conversations that AASHTO has had with both agency and Trump officials, the order is targeted at a small subset of programs, namely those aimed at promoting electric vehicles.
Read the full article in Governing Magazine here.