Concentration of CO2 in the Atmosphere

Cities Can Boost Access to Efficient Transportation Using $3 Billion from the New Climate Law


By Ben Jennings, Research Assistant, Transportation Program

A $3 billion program in the recent Inflation Reduction Act provides communities a key opportunity to invest in improving equitable access to efficient, low-carbon transportation. Known as the Neighborhood Access and Equity Grant Program, the funding is a critical complement to the bill’s investments in electric vehicles.

The program could be used to improve neighborhood walkability and ease access to transit, shared bicycles, and other micromobility options for millions of people around the country. While the Federal Highway Administration (FHWA) will likely issue guidance to clarify possible uses of the funds, it’s not too early for local governments to consider how they might apply to use them.

A Needed Complement to Electric Vehicle Funding

The transportation sector is the largest contributor of greenhouse gas (GHG) emissions in the United States, accounting for 27% of total emissions. Tackling these emissions will require both support for electric vehicles (EVs) and an increase in the efficiency of municipal transportation networks. Shared transportation for passengers and improvements to the efficiency of goods movement through enhanced logistics and the use of multimodal freight will help create transportation systems that not only are low carbon but also serve everyone.

The Infrastructure Investment and Jobs Act enacted last year increased funding for public transit and multimodal freight projects. More recently, the major climate and health law enacted in August, the Inflation Reduction Act, included significant funding supporting EVs. It included a light-duty EV tax credit worth up to $7,500 (with limits for the purchaser’s income and the price of the vehicle), a used-EV tax credit worth up to $4,000, 30% tax credits up to $40,000 for commercial EVs, $3 billion in funding for electrification of the Postal Service’s fleet, and $1 billion for replacing outdated nonelectric heavy-duty vehicles with new EVs… ​​​​​​

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