Congress’s new budget reconciliation bill takes back billions from locally-led projects across the country

We found that up to $4.7 billion in competitive grants promised to existing, awarded grantees across the country and billions more for financing climate projects will now be rescinded following the passage of H.R.1, the One Big Beautiful Bill Act. And that’s just the grants.

Correction: Earlier versions of this blog referred to incorrect numbers on the amount rescinded under the Greenhouse Gas Reduction Fund and Diesel Emissions Reduction Act and have been corrected.

Provisions included in the budget reconciliation bill that President Trump signed last week will rescind billions in transportation funding for projects that improve communities’ street safety, convenient job and opportunity access, and clean air. Whatever was not spent down before July 4, 2025, is now being clawed back. To understand the true impact of the bill, we took a look at public spending data from USAspending.gov to estimate how much funding had been obligated to projects and what was left to be pulled back.

Of these program rescissions, the one most likely to be acutely felt and impactful will be the $2.4 billion being taken back from the Neighborhood Access and Equity Program. Dozens of locally-led programs to address long-standing safety deficiencies from poorly conceived and often intentionally discriminatory projects of the past will now face delays or outright cancellation without this funding, after having a chance to utilize only a fraction of what they won in a rigorous competitive process. With similar projects to reconnect communities being so successful at improving a wide range of outcomes, from equity and safety to economic development, Congress’s decision to repeal this funding for community-focused infrastructure is anything but beautiful. 

Progress on electrification will also take a huge hit: Existing tax credits for the purchase of heavy-duty vehicles and both new and used consumer electric vehicles (EVs) will now be eliminated by September 30, 2025. But it doesn’t stop there. Tax credits for the installation of electric vehicle charging infrastructure will be eliminated by next summer (June 30, 2026). Though proposed by Transportation Committee Chair Rep. Sam Graves and included in the House’s version of the bill and discussed in the Senate, registration fees for EVs are not part of this bill. Despite the bill’s apparent goal to expedite the environmental permitting process and inclusion of a new fee to implement tighter environmental review deadlines, the bill eliminates funding from the 2022 Inflation Reduction Act aimed at improving states’ and localities’ ability to conduct those environmental reviews.

In addition to the $4.7 billion we identified as being rescinded from competitive grant programs, additional funding worth more than $20 billion is to be rescinded out of the EPA’s new climate financing program that would have dedicated funds to more efficient transportation infrastructure. Take a look at our program-by-program analysis of the transportation impacts of the “One Big Beautiful Bill Act”:

Neighborhood Access and Equity Program

The Neighborhood Access and Equity Program was one of the most promising new transportation programs of the last few years. Despite its separate name, it was essentially an enormous, $3.2 billion shot of additional funding for Reconnecting Communities projects to help communities repair the damage of divisive infrastructure. And the losses here are some of the most painful, with about $2.4 billion of funding that was awarded, promised, and written up in press releases now being clawed back from communities across the country. (We broke down what projects would be affected if the Neighborhood Access and Equity Program is rescinded in a previous post.) 

Dozens of communities are now left holding the bag for commitments that will be hard to fulfill. Multiple representatives and senators from the majority voted to rescind their own communities’ funding for these safety and access projects. Projects with unobligated balances for their grant awards, mapped below, will have their awarded funding rescinded and be left with multi-million-dollar holes in their budgets : 

Low-Carbon Transportation Materials Program

This $2 billion program from the Inflation Reduction Act encouraged the use of domestically produced low-carbon construction materials for transportation projects, like the $1.2 billion awarded to 39 states for projects to build infrastructure using less emissions-intensive concrete and asphalt mix. The remaining funding would have gone to non-state recipients, such as cities and metropolitan planning organizations (MPOs). Beyond making sure that new materials were less emissions-intensive, the program’s funds could not be used to expand road capacity, which itself can increase emissions. We estimate that only $147 million in funding was obligated before the passage of the bill (up from a previous estimate distributed to our T4A members), leaving more than $1.85 billion to be rescinded. 

Clean Heavy Duty Vehicles Program

The Clean Heavy Duty Vehicles Program, which the Inflation Reduction Act (IRA) funded at $1 billion, provided states, school districts, municipalities, and tribes opportunities to replace Class 6 and 7 heavy-duty vehicles with zero-emission alternatives. Examples of vehicles that would be replaced under the program include public transit buses, delivery trucks, school buses, semi-truck haulers, and other vehicles. Over $100 million in funding went to projects that included transit bus electrification, such as the North Central Texas Council of Governments’ project to acquire new, zero-emission vehicles in counties that don’t meet air quality standards. We found that only $546 million out of the $1 billion in funding was obligated, leaving around $454 million to be rescinded.

Diesel Emissions Reduction Act National Grants

A similar program to the Clean Heavy Duty Vehicles program described above, unobligated funding for the Diesel Emissions Reduction Act’s national grants is repealed by H.R.1. Six projects awarded using Inflation Reduction Act funding went at least partially to transit electrification, for either the upgrade of diesel trains (to potentially faster and rider-friendly electric rail) or efficient battery electric and hydrogen buses. The IRA provided $60 million in funding for the program.

Greenhouse Gas Reduction Fund

The bill rescinds $19 million in unobligated administrative funding for the $27 billion Greenhouse Gas Reduction Fund (GGRF), according to Congressional Budget Office data. The GGRF made clean transportation a priority (using strategies outlined in the U.S. National Blueprint for Transportation Decarbonization), and those projects were intended to be financed out of the $14 billion National Clean Investment Fund. Other priorities in the program include the Solar for All grant program, which dedicated $7 billion to residential solar. According to Environmental Protection Agency Administrator Lee Zeldin, $3 billion in funding had been obligated to projects prior to its rescission in the bill. Prior to the signing of the bill, the GGRF program was frozen by the Trump administration early in his term, and the administration’s authority to freeze the program has been the subject of ongoing litigation and may not yet have been unobligated or rescinded.

Transportation Project Environmental Reviews

The OBBB also rescinds Environmental Review Implementation Funds, funded at $100 million by the IRA, which provided training and capacity building for states and local governments to improve their ability to conduct environmental reviews, such as through the National Environmental Policy (NEPA) process. This rescission comes despite the fact that expediting permitting and the environmental review process is a stated priority for the House’s Transportation and Infrastructure Committee Chair, Representative Sam Graves, and the Senate’s Chair for the Environmental and Public Works Committee, Senator Shelley Moore Capito. The loss of these funds will only have a negative effect on the speed at which these reviews can be completed. H.R.1 instead included a provision for project sponsors to pay a fee equal to 125% the cost of an environmental assessment or impact statement to expedite environmental review timelines by adding deadlines. The true impact of such a policy is not yet certain, but it would not be surprising to see it further biases the process toward status quo projects, like highway widenings that provide familiar parameters for review, while failing to make the process easier for more nuanced and complex projects like transit expansions and highway removals. It is unclear how much had been obligated under this program before its rescission, but we found only three projects in three states with funding reported as obligated to recipients.