Specialized Heavy and Civil Engineering Construction NAICS 237990

Dec 6, 2025 - Continuing Resolution Slows Federal Agency Projects

• The 43-day federal shutdown, the longest in U.S. history, ended November 12, but construction industry disruptions persist, according to Engineering News-Record. Infrastructure agencies, including the Department of Transportation, the Environmental Protection Agency, and the Army Corps of Engineers, remain under a continuing resolution through January 30, 2026, which limits spending, staffing, and new program starts. Contractors are facing mounting delays in grant agreements, environmental reviews, and permit approvals, particularly for transportation, water, and civil works projects. Inflation and seasonal timing compound risks, as procurement delays may drive up material costs. Public owners must still meet Infrastructure Investment and Jobs Act deadlines despite slowed federal processing. The reopening offers a path forward, but recovery will be gradual, requiring strategic planning across the construction sector to manage uncertainty and maintain momentum.
• Construction firms that work on civil infrastructure projects are holding steady as they manage uncertainties, including waning backlog growth and stagnant margins, according to FMI’s fourth-quarter Civil Infrastructure Construction Index (CICI) survey. The CICI reading for the third quarter was 50.6 compared to 50.8 in Q3 2025 – on a 100-point scale. Any CICI reading above 50 indicates that more civil infrastructure contractors see conditions as good than poor. About half of civil infrastructure contractors reported that their backlogs in Q4 met or exceeded their targets. However, most noted that public projects are making up a growing share of overall backlogs, as private-sector projects face greater uncertainty. Contractors expect backlog growth to slow over the next few quarters as more firms vie for a narrower set of public projects. Contractor margins remained steady but flat in Q4 2025 as bid competition and rising cost pressures eroded pricing power.

• IThe Federal Railroad Administration (FRA) announced over $5 billion in grants under the National Railroad Partnership Program, including $2.4 billion rescinded from California’s High-Speed Rail Authority, which is now suing to recover the funds, according to Engineering News-Record. Grants are open to states, tribes, Amtrak, and local governments for intercity passenger rail projects, with a focus on safety improvements. The reissued notice replaces the previous Federal-State Partnership program and removes references to six executive orders, while adding one from President Trump. California’s agency claims the funding termination was unlawful and seeks a court injunction to prevent redistribution. Applications for the new funding are due by January 7, 2026.
• In July, twenty state attorneys general filed a federal lawsuit challenging the Trump administration’s elimination of FEMA’s Building Resilient Infrastructure and Communities (BRIC) program, according to Engineering News-Record. The BRIC program helps fund projects to protect cities and coasts from flash flooding, storm surges, and other natural disasters caused by extreme weather. The suit argues that FEMA officials lacked legal authority to shut down the program and violated the Constitution by redirecting funds appropriated by Congress. Since its creation in 2018, BRIC has distributed over $5 billion to help cities prepare for extreme weather events. States claim the program’s termination has forced communities to delay or cancel hundreds of projects, increasing vulnerability to natural disasters. In August, a federal judge issued a preliminary injunction to stop the federal government from redirecting funds allocated to the BRIC program while the case moves forward.