Government funding for highways

As the number of cars on the road and the amount of time Americans spend driving have increased, the strain placed on the nation's infrastructure has also risen. Therefore, federal and state governments have steadily increased their spending on maintaining and building roads. Burgeoning state tax receipts also has made higher funding possible as aggregate incomes, spending, populations and tax rates have trended upwards. However, this close link with tax receipts has made highway funding growth responsive to economic conditions and unemployment. As conditions worsen, there are fewer tax dollars, causing road maintenance budgets to flat-line or reverse as governments try to avoid or minimize deficits. This occurred following the recession, with federal, state and local highway spending declining 0.2% in 2009 and 0.7% in 2010. The slump may have been steeper without the American Recovery and Reinvestment Act of 2009, which provided $27.5 billion for highway and bridge construction, which kept highway funding afloat that year. Nonetheless, government funding for highways fell another 2.5% in 2011 before returning to growth in 2012.

According to the Congressional Budget Office, highways and water utilities comprise the most significant shares of infrastructure spending by state and local governments. Since the 1950s, when highways comprised 66.0% of state and local government's infrastructure spending, highways have accounted for a smaller share of total infrastructure spending (40.2% in 2017). The federal government funds highway infrastructure investments via the Highway Trust Fund, which uses gasoline tax revenue to support infrastructure development costs. Since 2008, the federal government has needed to subsidize the Highway Trust Fund to mitigate a deficit.

Historically, although infrastructure spending has grown, it has yet to keep pace with the economic growth rate. With these factors entailed, it has fallen in real terms. This includes highway infrastructure spending by state, local and federal governments. Highways remain one of the most significant types of federal infrastructure spending. In 2017, the CBO reported that state and local governments spent 74.0% of their spending on the US highway system. In turn, 47.0% of total expenditure on highways was for the operation and maintenance of highways. With the COVID-19 pandemic in 2020, which curtailed commute patterns amid shutdowns and lockdowns of large swaths of the economy, necessary action was taken to keep these parts of society managed and maintained. With the passage of the Consolidated Appropriations Act of 2021 along with the extension of the FAST Act to 2021 instead of 2020 when it was initially set to expire, both helped provide additional funding for highway projects and programs in the time, keeping these swaths of the government's operations continually running into the following year. The passing of the Infrastructure and Jobs Act of 2021 also contributed to nominal boosts in highway funding amid a less deadlocked Congress in the year. However, government highway funding was slightly lowered in 2023 with an impacted budget. The Department of Transportation had restricted more funding to get allocated while the lack of new historical legislation that had boosted infrastructure funding as with the previous years lessened how much funds were generated in the year. However, funding on highways is set to scale up in both 2024 and 2025 with the passage of appropriations from Congress will help scale up funding in the years ahead, preventing more budgetary shortfalls from happening despite a gridlocked Congress and the threat of a shutdown in the previous years.