Fed spending cuts delay city’s workforce, infrastructure training plans

City staff are seeking additional time to develop a comprehensive plan for funding and implementing the city’s workforce development program, in part due to federal funding delays and broader budget uncertainties. A recent memo to City Council from the city’s Economic Development Department notes that efforts to secure federal funds for that purpose have been hindered by budget restructuring at the national level, prompting a request to extend the city’s reporting deadline to Aug. 31.

The delay affects implementation of a resolution adopted by Council last March that directed the city manager to create a new workforce development initiative designed to support the city’s expanding infrastructure workforce needs. The resolution closely tracks the goals and structure of the Austin Infrastructure Academy, a public-private training and job placement network developed in partnership with Workforce Solutions Capital Area.

While the resolution does not refer to the academy by name in every section, its directives, such as aligning training programs with real-time labor market needs, providing wraparound services like child care, and recruiting from underserved communities, mirror the framework and mission of the AIA.

In a statement to the Austin Monitor, Tamara Atkinson, CEO of Workforce Solutions Capital Area, drew a distinction between the city’s broader workforce development strategy and the existing AIA contract. Atkinson confirmed that the AIA’s current agreement with the city does not include federal funding and is not directly affected by recent federal funding delays.

She added that the funding subcommittee mentioned in the memo is focused on long-term sustainability planning and exploring future public-private partnerships.

That goal has been part of the AIA’s design since its inception, with early backing from supporters such as Texas Mutual and Google.org, the tech giant’s charitable organization.

The 2024 resolution appears to treat the AIA not as a stand-alone contract but as the foundation of a larger, city-led initiative to prepare Austin’s workforce for an unprecedented wave of capital investment. Prior to its passage last year, comments and Council positioned AIA as a pivotal component of the city’s workforce training needs to prepare for completing roughly $25 billion infrastructure projects over the next decade-plus.

“​​It’s evident that our city was ill-prepared to accommodate this expansion by not investing in our workforce,” Council Member José Velásquez said prior to the resolution’s passage. “Austin was made unaffordable to many, forcing longtime residents out of their homes. This isn’t a new story to anybody here or anybody on this dais. This one-of-a-kind academy is representative of our city’s booming growth and our commitment as a council to ensure that we are preparing our communities and families to grow alongside it, to be able to stay and live in the city that we all love.”

Last week, at an infrastructure summit organized by the Austin Chamber of Commerce, Atkinson and Mayor Kirk Watson’s keynote discussion focused on AIA’s importance in preparing new workers needed for local jobs. The memo from EDD interim Director Anthony Segura regarding difficulties in workforce funding was issued the day after that summit.

Through a spokesperson, Watson declined comment.

City officials have projected the need for 10,000 new infrastructure workers annually through 2040 to meet the demands of major public and private projects such as Project Connect and the airport expansion. Roles in demand include skilled trades, construction, project management, environmental compliance and operations supervision.

Developed in part through the Workforce Mobility Industry Sector Partnership initiated by Workforce Solutions, the AIA aims to streamline recruitment, training and job placement across the region. In addition to technical training, it incorporates services like career navigation and child care support to remove participation barriers and expand access to high-quality jobs.

City leaders have also emphasized equity as a central goal, citing the opportunity to significantly expand the number of women and people of color in skilled infrastructure roles.

Austin’s workforce strategy has evolved in recent years to blend public investment with private-sector collaboration. During the pandemic, the city launched the Austin Civilian Conservation Corps as a rapid response job training program in environmental and infrastructure maintenance. That effort, initially funded by the American Rescue Plan Act, is now facing a funding gap as ARPA dollars run out. The city is considering allocating $1 million in its upcoming budget to continue the program.

A federal grant freeze announced in January 2025 temporarily disrupted planning for several local programs, although a court-ordered stay is currently in effect. As a result, city departments are weighing how to move forward with key initiatives without relying heavily on external funding sources.

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