The fed agencies that do the transportation funding do both competitive and formula grants typically. I think it is a balancing act, much like the house and senate is supposed to be. One is regulated by the 2 per state rule. The other is regulated by the “based on population” rule. TIGER III funds will be fought over but so will a bunch of others. In the Federal Transit Administration, for example, there are around eight programs available to folks in specific categories, like Job Access or Rural Transit. These programs provide funds to folks who might not be able to compete for the 13 or so competitive grant programs. Even the competitive ones have different focuses that make the whole more equitable. There are programs focused on University transit, Tribal transit, and lots of others.
I think having folks jump through hoops to get the funds (and to keep them) makes them think through the process a lot more and maybe make better decisions overall. I seem to recall hearing that once upon a time, congress would grant funds to a big city and then never check back to see that it was spent on what it was supposed to be spent on. Earmarks were a way to get funding for things people didn’t feel like talking about so when they couldn’t get a transportation bill out they could still get funds for transportation. It seems like folks on the hill work better when we don’t know and can’t see what they are doing. The transparency is making them visible and responsible and who wants that?! (tongue firmly in cheek).
Unless radical changes are going to be made (unlikely) getting large, important, infrastructure type funding out to folks is going to be tough but necessary to keep all of us moving (metaphorically and otherwise).
Oh, and to be open and transparent, I’m a contractor to a Department of Transportation agency and formerly to other agencies within DOT and I’m speaking on my own behalf only, not for my contracting company nor any Fed agency I currently or formerly have worked with.