Rail, maritime caught in Trump's order freezing federal spending

Yahoo

28-01-2025

Supply chain executives are waiting to see how billions of dollars from the U.S. Department of Transportation will be affected by President Donald Trump's order freezing spending on thousands of federal assistance programs.
The Trump administration on Monday issued a vague, two-page memo ordering government agencies to temporarily suspend all federal assistance payments except for Social Security and Medicare.
Politico reported Tuesday that the Office of Management and Budget (OMB) has asked federal agencies to provide information by Feb. 7 about programs and related spending through March 15. The pause in funding 'will provide the Administration time to review agency programs and determine the best uses of the funding for those programs consistent with the law and the President's priorities,' Monday's memo says.
The request for spending program information, detailed in a 52-page spreadsheet, asks DOT to identify programs the agency currently funds – meaning rail, highway and maritime programs potentially could be on the administration's chopping block.Among them:
The Consolidated Rail Infrastructure and Safety Improvements (CRISI) Program.
Grants to Amtrak that would fund the acquisition of new equipment and route expansion.
Capital assistance to states for intercity passenger rail service.
High-speed rail corridors and intercity passenger rail service.
Federal-state partnership for intercity passenger rail.
The Passenger Rail Investment and Improvement Act.
The Railroad Rehabilitation and Improvement Financing Program.
Grade crossing elimination programs.
Grants for railroad safety technology and research and development.
Rail line relocation programs.
It also appears that the Treasury Department is being asked to provide information about the 45G tax credit that shortline railroads rely on to fund track maintenance.
Representatives for Amtrak, the Federal Railroad Administration, which administers rail-related grant and loan programs, and the Maritime Administration did not immediately respond to requests for comment.
The Association of American Railroads referred federal funding questions to the OMB and DOT.'As a reminder, railroads privately fund the overwhelming majority of our infrastructure projects to the tune of more than $23 billion a year,' the AAR said in an email statement. 'Those investments will continue moving forward to enhance the safety and reliability of the national rail network regardless of the status of federal funding disbursements.'
The American Short Line and Regional Railroad Association says that while it's unclear how the various spending programs will be judged, the CRISI and rail crossing elimination programs do not appear to be in conflict with the administration's priorities.
For now, however, shortline funding programs appear to be on ice. 'Short line project grantees are definitely affected, at least temporarily,' ASLRRA President Chuck Baker said in the statement.
It's unclear how the programs will be reviewed, Baker says.
'If every single project has to be reviewed and reconsidered, that could be a lengthy delay,' he said. 'There are hundreds of projects just in those two programs, and spread across the whole government the number of projects would likely run well into the tens of thousands.'
Baker adds that he expects Transportation Secretary Sean Duffy — who was confirmed Tuesday afternoon — to 'approach this with considered common sense and get projects reviewed and approved quickly.'
'We do believe that it would be a bad precedent to set to allow a new administration to cancel or even unnecessarily delay projects that have already been selected by the previous administration under the statutory criteria at the time, as long as the grantee is keeping up its end of the bargain,' Baker said. 'It's one thing to change the criteria going forward or to make different types of selections in the next round than the previous administration would have made, that is their right and the expected consequence of an election. But to undo prior grants risks making the whole program less effective and predictable and that uncertainty would make building infrastructure more expensive.'
Other supply chain stakeholders were awaiting clarification.'With federal grant funding now under review, we will wait for that process to be completed,' said Gene Seroka, executive director, Port of Los Angeles, in a statement to FreightWaves. 'Federal partnership is an important component of our public-private initiatives. We stand ready to work with all levels of government to reach our infrastructure and sustainability goals.'
In 2024 the Environmental Protection Agency announced a $412 million grant for LA's zero-emissions port equipment and terminal upgrades.
The port's infrastructure projects in 2024 were helped by a record $60 million in federal money from the U.S. Army Corps of Engineers' Harbor Maintenance Trust Fund, which ports pay into. It is uncertain whether those monies would be affected.
Trump's order, which was scheduled to go into effect at 5 p.m. Eastern on Tuesday, has caused a stir in Washington.
Democrats are calling Trump's order an illegal violation of Congress' authority, while the attorneys general of several states plan to challenge the order in federal court.
They argue that a 1974 law requires the executive branch to spend money that has been authorized by Congress and signed by the president. Programs that would fall into this category include funding authorized under President Joe Biden's Bipartisan Infrastructure Law – which included $66 billion in rail spending.
Included in that total through fiscal year 2026: $22 billion for Amtrak, $5 billion for CRISI grants, $3 billion for railroad crossing elimination and $36 billion in federal-state passenger partnerships.
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