A Look at the Department of Transportation’s FY 2026 Budget Request

Industry held its collective breath when some of the materials related to the President’s FY 2026 Budget request began appearing a few weeks ago. The news coming out over the preceding weeks had been uniformly negative and focused on the activities of the Department of Government Efficiency (DOGE). Those efforts to identify waste, fraud, and abuse seemed to indicate that the discretionary budgets of most civilian agencies would see deep cuts compared to previous years.

The Department of Transportation’s discretionary budget will indeed take a hit in FY 2026, falling to $142B compared to the $152.6B it received from the annualized Continuing Resolution in FY 2025. Looking back one year to FY 2024 shows, however, that the DOT received $144B in discretionary funding, meaning that the FY 2026 request is down only 1.3% by comparison. Mandatory funding slated for the DOT in FY 2022 Infrastructure Investment and Jobs Act (IIJA), also know as the Bipartisan Infrastructure Law, also supports budgetary resilience at the DOT.

For example, in FY 2026, the DOT is scheduled to receive $35.8B in IIJA funding. This is reflected in the component agency budgets as follows.

• The Federal Highway Administration (FHWA) requested $72.6B (inc. mandatory spending and $8.5B in IIJA funding), including $10.2B for the Highway Infrastructure Program.
• The Federal Aviation Administration (FAA) requested $27.0B (inc. $5.0B in IIJA funds), of which $13.8B is for FAA Operations and another $5.0B is for Facilities and Equipment.
• The Federal Transit Administration (FTA) requested $21.2B (inc. $4.3B in IIJA funds), $14.6B of which is for Transit Formula Grants.
• The Federal Railroad Administration (FRA) requested $16.4B (inc. $13.2B in IIJA funds), including $6.8B for Amtrak and $44M is for Railroad R&D.
• The Office of the Secretary of Transportation requested $4.5B (inc. $3.8B in IIJA funds), including $2.5B for National Infrastructure Investments.

Funding for Cloud-Related Investments

DOT budget documents also call out funding for programs leveraging certain types of technologies, such as cloud computing. Agencies that requested budgets for programs leveraging cloud technology include the FAA ($124.4M), the Federal Motor Carrier Safety Administration ($34.3M) and the National Highway Traffic Safety Administration ($9.0M).

The FAA requested budgetary resources for the following programs leveraging cloud computing:

• Aeronautical Information Management Modernization Enhancement – $80.6M to digitize and streamline aeronautical information for automated exchange across the National Airspace System and replace outdated, redundant systems with a cloud-based Airspace Management Service.
• Traffic Flow Management Infrastructure Flow Management Data and Services – $26.6M for program management and access costs for a cloud development environment, training and test planning.
• Separation Management Portfolio – $13.8M to host separation management applications.
• Instrument Flight Procedures Automation – $2.4M to transition the IFPA to FAA Cloud Services hosting.

The FMCSA called out only a single program leveraging cloud technology: Motor Carrier Safety Operations and Programs Cybersecurity-as-a-Service – $34.3M for the FMCSA’s share of DOT investments in cybersecurity and commodity IT.

Lastly, the NHTSA requested $9.0M for cloud storage for the Office of Defects Investigation’s Artemis System.

Summing up, mandatory spending demanded by the IIJA will sustain functions at the DOT’s subordinate agencies while new discretionary funding will be invested in continuing the DOT’s journey to the cloud.