EPA Opens apps for $4.6B in Climate Grants for States, Municipalities, Tribes and Territories

By Aaron L. Szabo, Nick Weber, Faegre Drinker Biddle & Reath LLP
Special to The Digest

Last  month, the U.S. Environmental Protection Agency’s (EPA) Office of Air and Radiation (OAR) announced $4.6 billion in availability for grants under the Climate Pollution Reduction Grant (CPRG) program.

The CPRG program was established by Section 60114 of the Inflation Reduction Act (IRA). [1] The CPRG program is structured to have two parts: a planning grant phase and an implementation grant phase. The implementation grant phase is further divided into two grant programs that are currently open:

1. General competition open to states, municipalities, tribes and territories, which provides 1. $4.3 billion; and
2. Only tribes and territories competition, which provides $300 million.

If an applicant wins an award, the awardee will likely need to contract, subcontract or subaward funds to private companies to implement all or part of the grant activity. To note, the awardee will need to follow federal guidance such as EPA’s Subaward Policy and U.S. Department of Labor and U.S. Department of Commerce’s Good Jobs Principles.

Planning Grant Phase

EPA has provided — or is potentially providing — grants to:

46 states, [2] the District of Columbia and Puerto Rico; 79 metropolitan statistical areas (MSAs or municipalities); and 94 tribes and territories (together as coalition applicants and as individual applicants). [3]

Previously awarded planning grants are being used to develop Primary Climate Action Plans (PCAP) and Comprehensive Climate Action Plans (CCAP). The PCAP and CCAP are used to reduce greenhouse gas (GHG) emissions in six key sectors of the economy:

1. Electricity generation;

2. Industry;

3. Transportation;

4. Buildings;

5. Agriculture/natural and working lands; and

6. Waste management.

PCAPs are due March 1, 2024, for states and MSAs, and April 1, 2024, for tribes and territories. CCAPs are due in mid-2025. Due to the timing of the PCAP and CCAP, only the PCAP will be used for developing applications for implementation grants, and only elements included in the PCAP will be funded as part of an implementation award.

Implementation Grant Phase

The implementation grant planning phase provides $4.6 billion divided between two different grant applications. The general grant competition is providing $4.3 billion and is available to all applicants. The tribes and territories grant competition provides $300 million to tribes and territories, although tribes and territories may apply to both grants. Unlike other grant programs, there are no cost-sharing or matching funds required for these grants.

In addition, applicants can pair these grants with other available grant funds (e.g., Diesel Emission Reduction Act grants).

What Are the Key Dates?

Grant Competition

Notification of intent to apply (optional) February 1, 2024 March 1, 2024

Applications due April 1, 2024 May 1, 2024

Selection announcement (anticipated) July 2024 September 2024

Awards (anticipated) October 2024 December 2024

Who Can Apply?

The implementation grant phase is open to states (or MSAs within states that are applicants), municipalities, tribes and territories. However, Florida, Iowa, Kentucky and South Dakota did not participate in the PCAP phase and, as such, are ineligible for implementation grants, as are municipalities located within those states, unless they are within an MSA that did receive a PCAP grant. [4]

Applicants may apply individually and/or in a combined coalition. Applicants may receive multiple grants, but no grants may overlap the same geographical area. Therefore, if an applicant chooses to submit multiple implementation grant applications, they should ensure that they do not overlap geographically.

EPA has states for which this is intended to be the only round of funding, with no additional rounds. EPA does not plan on issuing more than two grants to applicants at the same level of government within a single jurisdiction (e.g., single state, municipality, tribal area or territory).

How Will Grants Be Evaluated?

For the general competition, EPA is providing grants from $2 million to $500 million, has divided the grant review into five tiers, and plans to select awardees within each of these tiers:

Tier A $200,000,000–$500,000,000, $2 billion 4–10 expected awards

Tier B $100,000,000–$199,999,999, $1.3 billion 6–13 expected awards

Tier C $50,000,000–$99,999,999, $0.6 billion 6–12 expected awards

Tier D $10,000,000–$49,999,999, $0.3 billion 6–30 expected awards

Tier E $2,000,000–$9,999,999 $0.1 billion 10–50 expected awards

For the tribes and territories competition, EPA is providing grants from $1 million to $25 million and divided the grant review as follows:

Tier Grant Ranges/ Funds Targeted for Each Tier / Anticipated Number of

Grants to Be Awarded

Tier A $15,000,000–$25,000,000, $125 million, 5–8

Tier B $5,000,000–$14,999,999, $100 million, 7–20

Tier C $1,000,000–$4,999,999, $75 million, 15–75

What Are the Requirements for Awardees?

Those applicants who win awards from EPA will be required to provide semi-annual progress reports and a detailed final report within 120 calendar days of completion of the period of performance.

Construction activities will be subject to prevailing wage requirements as determined by the U.S. Department of Labor under the Davis-Bacon and Related Acts authority. Additionally, CPRG implementation grants may be subject to the Build America, Buy America provisions of the Infrastructure Investment and Jobs Act.

F O O T N O T E S

1. 42 U.S.C. § 7437.

Florida, Iowa, Kentucky and South Dakota declined to participate in the planning grant phase; however,

municipalities within those states did participate in the planning grant phase.

2. All states, MSAs, tribes and territories who received an EPA planning grant can be found at cprg_planning_grant_award_status.pdf (epa.gov).

3. This also includes state agencies, departments or other executive branch–level offices in these states.

In addition, no MSAs are allowed to apply that are not covered by PCAPs developed by MSAs in the state.

4. The material contained in this communication is informational, general in nature and does not constitute legal advice. The material

contained in this communication should not be relied upon or used without consulting a lawyer to consider your specific circumstances.

This communication was published on the date specified and may not include any changes in the topics, laws, rules or regulations covered. Receipt of this communication does not establish an attorney-client relationship. In some jurisdictions, this communication may be considered attorney advertising.