The attached video aired on April 29, 2025, and discusses the potential loss of the federal grant.
AUSTIN (KXAN) — A Wednesday memo from the city of Austin’s Intergovernmental Relations Office, or IGRO, gave updates about the status of federal grants, including the loss of millions in previously awarded grants that have been terminated.
IGRO officer Carrie Rogers authored the memo. It urges the city council to spend available funds “expeditiously and with great care,” as the federal government’s directives have “varied widely since January 2025.”
In it, Rogers detailed the latest changes to Austin’s “Cap and Stitch Program,” ending speculation about the grant’s status.
“Austin Transportation and Public Works received official notice on Wednesday … that the $105 million Neighborhood Access and Equity grant, awarded to support a 5.3-acre I-35 highway cap through downtown Austin, has been rescinded,” the memo reads. “All unobligated funds from the NAE Grant Program were eliminated as part of H.R. 1, One Big Beautiful Bill.”
The grant for cap and stitch was awarded in 2023 by the Biden Administration’s Department of Transportation. In May, city council voted to approve the transfer of $104 million to the Texas Department of Transportation, or TxDOT, for the project.
KXAN has asked the city for an update on the project’s status.
Austin Energy may receive bad news soon about an already awarded $32 million grant from the Environmental Protection Agency’s national Solar for All program, according to the memo. KXAN previously reported that program was used to expand rooftop solar in the city, which likely helped to reduce pollution in Austin.
Rogers wrote that the city learned Tuesday the EPA was preparing to send out letters terminating the grants “as early as this week.” She noted Austin Energy was preparing to hire a full-time employee for one of three grant-funded positions.
“This program would provide low-income customers and the community with resilient and sustainable energy solutions,” the memo reads. “Austin Energy will be exploring all options, along with our partner organizations, to pursue this previously approved agreement and funding.”
The memo noted the city is set to receive $3.7 million from the Federal Emergency Management Agency, or FEMA, for its “Urban Areas Security Initiative” (UASI). That grant program is for regional hardening projects “needed to prevent, protect against, respond to, and recover from acts of terrorism and other catastrophic events.”
FEMA gave Austin $1.3 million annually for UASI over the past two fiscal years.
“The program continues to have strong bipartisan support on Capitol Hill, although it appeared that [FEMA] was maneuvering to reprogram or rescind FY 2025 UASI funds. The Austin Metropolitan Area is always on the cusp of UASI funding under the risk-based formula, and any reprogramming could jeopardize our FY 2025 participation in the program,” Rogers’ memo reads.
Finally, the memo details how Trump’s July 24 executive order, “Ending Crime and Disorder in America,” will impact some city programs. Specifically, it suggests the U.S. Department of Justice will more strongly use an anti-DEI (diversity, equity and inclusion) attitude when considering grant funding.