Key Issues > Funding the Nation's Surface Transportation System - High Risk Issue
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Funding the Nation's Surface Transportation System - High Risk Issue

The nation's surface transportation system is critical to the economy and affects the daily life of most Americans. However, the costs to repair and upgrade the nation's surface transportation system to meet current and future demands are estimated in the hundreds of billions of dollars, and a sustainable solution to funding surface transportation has yet to be found.

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This key issue page is related to an area on GAO’s 2017 High Risk Update and will be updated shortly. In the meantime, visit the related High Risk area for the newest information.

Funding the nation’s surface transportation program has been designated high risk for several reasons, including:

  • Motor fuel and other truck-related taxes that support the Highway Trust Fund—the major source of federal surface transportation funding—are eroding. Federal motor fuel tax rates have not increased since 1993, and drivers of passenger vehicles with average fuel efficiency currently pay about $96 per year in federal gasoline taxes. Because of inflation, the 18.4 cent-per-gallon tax on gasoline enacted in 1993 is worth about 11.5 cents today. This trend will likely continue as demand for gasoline decreases with the introduction and adoption of more fuel-efficient and alternative fuel vehicles.
  • To maintain spending levels of about $45-50 billion a year for highway and transit programs and to cover revenue shortfalls, Congress transferred a total of about $63 billion in general revenues to the Highway Trust Fund on six occasions between 2008 and 2014. This approach has effectively ended the long-standing principle of “users pay” in highway finance, breaking the link between the taxes paid and the benefits received by highway users.
  • In August 2014, the Congressional Budget Office estimated that $157 billion in additional revenues would be required to maintain current spending levels plus inflation between 2015 and 2024.
  • A sustainable solution to funding surface transportation is based on balancing revenues to and spending from the Highway Trust Fund. New revenues from users can come only from taxes and fees, and ultimately major changes in transportation spending, revenues, or both will be needed to bring the two into balance.
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  • portrait of Susan Fleming
    • Susan Fleming
    • Director, Physical Infrastructure
    • (202) 512-2834