Over the past few years, every state and the District of Columbia receive more in federal highway funding than the various federal excise taxes on highway activities within the state generated, according to the Government Accountability Office. During FY 2005–2009, the funding return on highway taxes ranged from $1.03 for every dollar collected in Texas to $5.85 in Washington, D.C. Massachusetts, on the low end of the scale, received $1.17 for every dollar collected.
While the vast majority of Massachusetts highway funding comes from non-federal sources, if all highway funding responsibility were to be devolved to the states—as a growing number of fiscal conservatives in Congress advocate—additional revenue must be found. This issue brief examines the current funding realities and offers several potential mechanisms that could be used in Massachusetts to close the funding gap under a devolution scenario.
However, there is a way forward. Maintaining the “user-pays/user-benefits” funding principle should be of the utmost importance to transportation policy makers seeking to address the nation’s growing transportation challenges.
New technologies can help create novel approaches to transportation funding. To get there, we also need to turn away from existing failed policies.