A plan to add parks over I-35 in Austin is expected to move forward despite the loss of a $105 million federal grant.
A city spokesperson told KUT News on Friday that "the downtown Austin highway caps approved by City Council will continue to move forward."
The city was set to receive the Neighborhood Access and Equity Grant to help pay for parks on decks installed over the highway after the state lowers the main lanes. In a , Carrie Rogers, the city’s intergovernmental relations officer, said the funding had been rescinded after the grant was eliminated under the One Big Beautiful Bill Act.
Austin city leaders had anticipated the loss when the City Council approved the project in May.
The Trump administration has slashed federal funding for a number of programs, including some Austin Public Health initiatives and several National Endowment for the Arts grants for local nonprofits. More cuts that could impact Austin are expected, .
The city’s plan to build parks over I-35 was conceived as part of the state project to widen and lower the freeway. It is the largest expansion of the highway since it opened in 1962.
In May, the Austin City Council approved paying $104 million for support columns that would allow decks to be installed over certain parts of I-35. Parks and other amenities would be built on top of the decks.
It is unclear how much the total price tag will be or how the city will fund construction. But it has time to figure that out.
The first payment for the support structures is not due until 2026. City leaders have discussed adding the project to a bond package.
The loss of the grant comes as the city faces financial constraints due to flat sales tax revenue, limited property tax revenue and an end to other federal funding. The City Council is considering calling for a tax rate election to help make up for the gap.
Construction on the I-35 expansion project is slated to be completed by 2033.
