The Infrastructure Investment and Jobs Act (IIJA)

The IIJA, a mammoth $1.2 trillion funding package, constitutes the largest infusion of federal investment into infrastructure in over a decade, impacting almost every aspect of the American economy.

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This transformative legislation provides substantial funding for the improvement of aging roads, bridges, airports and rail lines; modernization of electrical grids; advancement of clean energy production; expansion of high-speed internet access; upgrading of water infrastructure; fortification of government cybersecurity efforts; enhancement of public transit; and better protection of the environment.

Topline above-baseline spending in Infrastructure Investment and Jobs Act (USD) 

Pillsbury is closely monitoring developments regarding the Infrastructure Investment and Jobs Act, offering timely updates on the politics and policies surrounding it and the emerging opportunities it presents across sectors.

New Federal Spending:

        • Allocates roughly $1.2 trillion over 10 years, including $550 billion in new spending above baseline levels over the next five years.
        • Touches a wide range of sectors, including transportation, energy, water, broadband and cybersecurity.

The CHIPS and Science Act

The CHIPS Act directs $280 billion to build, expand or modernize domestic facilities and equipment for semiconductor fabrication, assembly, testing, advanced packaging or research and development (R&D), with a majority of funds dedicated to scientific R&D and commercialization. 

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CHIPS Act funds are distributed through programs at the National Science Foundation, the Department of Energy and the Department of Commerce. Pillsbury assists clients in preparing for all stages of the CHIPS application—including a statement of interest, pre-application and full application—and guides entities through the agency review process, including representation during meetings and agency negotiations.

Major Incentives:

  • Semiconductor Manufacturing: a competitive grant program funding investments in facilities and equipment for the fabrication, assembly, testing, packaging, production or R&D of semiconductors, materials or equipment.
  • Advanced Manufacturing Investment Tax Credit: equal to 25 percent of the qualified investment in a taxable year for any advanced manufacturing facility of an eligible taxpayer, where construction begins before Jan. 1, 2027.
  • Workforce and Education Fund: provides $200 million in loan and loan guarantee funding for workforce development activities, including training and apprenticeships.

The Inflation Reduction Act (IRA)

The IRA, which builds on IIJA and CHIPS Act investments, includes the most significant climate investments in U.S. history to support the U.S. economy’s shift to clean energy.

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The legislation provides various funding opportunities, as well as comprehensive tax incentives to spur clean energy initiatives and billions in new federal spending for health care priorities. It also includes targeted tax code changes that will impact corporations and investment funds, and sets aside billions in increased tax enforcement funding designed to generate revenue and reduce the federal deficit.

Major components:

  • $400 billion for clean energy and environmental priorities.
  • Federal government negotiating powers in health care, plus extension of the Affordable Care tax credit.
  • A 15 percent alternative minimum tax on corporations, a 1 percent excise tax on stock buy backs and $80 billion in increased funding for IRS enforcement.

Private entities may benefit directly, by receiving grants or tax credits, or indirectly by partnering on public projects. Examples of actionable opportunities include IRA tax credits across many sectors, such as renewable energy production and manufacturing and clean fuels and vehicles.

Direct grants include:

  • Advanced Industrial Facilities Deployment Program: $5.8 billion available until Sept. 30, 2026.
  • Domestic Manufacturing Conversion Grants: $2 billion available until Sept. 30, 2031.

Loan Guarantees include:

  • Innovative Clean Energy Loan Program: an additional $40 billion in commitment authority plus $3.6 billion in credit subsidy cost through Sept. 30, 2026.
  • Energy Infrastructure Reinvestment: $5 billion appropriated through Sept. 30, 2026, with a cap on loans of up to $250 billion.