By Amanda Day, Grants Development Consultant (State and Local Government)
The 2026 federal budget for the U.S. Department of Transportation (DOT) offers valuable insight for agencies, municipalities, and partners pursuing federal transportation funding. Focus areas this year include aviation modernization, maritime and port investments, and traditional highway and rail maintenance. Many programs continue to be funded under the Infrastructure Investment and Jobs Act (IIJA), signed by the Biden Administration in 2021.
The most significant increase in funding is directed at the Federal Aviation Administration (FAA). A landmark $22 billion investment has been allocated to air traffic controllers to address staff shortages.. An additional $4 billion is set aside for infrastructure modernization, including facilities and equipment, with $450 million specifically earmarked for radar modernization to replace aging systems.
Key aviation grants include:
Maritime investments are also a strong focus in 2026, highlighting priorities such as national security, supply chain resilience, and global trade. With a stronger focus on national security and global trade, $1.5 billion was allocated to the Maritime Administration (MARAD). A large share supports the Port Infrastructure Development Program (PIDP). This program funds projects to enhance port capacity, efficiency, and connectivity, while additional investments strengthen maritime security. These efforts are intended to modernize ports, ease congestion, and strengthen the reliability of the nation’s freight network.
Key maritime and port funding includes:
Highway safety and infrastructure are also a focus in the federal budget. These programs are key in sustaining, upgrading, and expanding America’s transportation system. Funding is available to state, local, and tribal governments to advance major projects such as bridge rehabilitation, highway reconstruction, congestion mitigation, and safety enhancement efforts that are often beyond the budget capacity of individual jurisdictions. These investments help maintain consistent national standards, improve freight and supply chain efficiency, and enhance roadway safety by addressing high-risk corridors and aging infrastructure.
Key highway safety and infrastructure funding:
Additionally, the budget makes substantial investments in the nation’s rail system, benefiting both passenger and freight rail. This funding will enhance safety, reliability, and capacity. These efforts aim to improve intercity passenger rail service while also increasing the efficiency and performance of freight corridors that are essential to national supply chains and economic growth.
Key rail grant programs:
The Department of Transportation’s (DOT) funding for FY26 reflects a continued focus on infrastructure investments, national security, safety improvements, and economic growth. As the Bipartisan Infrastructure Law approaches its September 30, 2026, expiration, the DOT is pivoting toward ensuring the projects already started are completed, while doubling down on the safety of the skies and the resilience of American ports, highways, and rail systems.
Examples of Biden Era IIJA Funded Programs
- Rural Surface Transportation Grant Program (RURAL)
- Safe Streets and Roads for All (SS4A)
- National Electric Vehicle Infrastructure (NEVI) Formula Program
- Airport Terminal Program (ATP)
- Bridge Investment Program
- Promoting Resilient Operations for Transformative Efficient and Cost-saving Transportation (PROTECT)