05-12-20 | Association News

Staying Home Leads to Decrease in Highway Funds

The AASHTO Is Expecting a Sharp Decrease in Funds for Highways and Roads

Nationwide stay at home orders have naturally led to a decline in travel. These orders carry the intention of limiting contact between individuals as much as possible. However, it appears that there may have been an unintended consequence resulting in a substantial decrease in funding for highways and roads in states throughout the country.

The AASHTO has recently published an article suggesting that states may see decreases of highway funding in the hundreds of millions over the next year. Funding for highways generally comes from a tax on fuel, so the minimal amount of driving results in a significant drop in the amount of gasoline needed for the cars. Less gas being purchased means less tax coming from those purchases that the state governments can use for road maintenance and development.

Studies conducted by the University of California Davis and the Illinois Economic Policy Institute found that travel is down by at least 40% and up to 90% in some cases. Reductions in average miles driven across states would reflect proportionally in the amount of money going into fuel and, therefore, the amount of funding available from fuel taxes. The Maine and Minnesota Departments of Transportation are anticipating losses of approximately $124 million and $440 million for their respective states over the next year and a half if the current trends continue.

States have begun postponing particular projects to combat the issue. Furthermore, certain states, North Virginia, which was specifically noted in the AASHTO's piece, have held meetings to discuss plans on how to navigate the losses. Time will tell the long-term effects, but as for now, states are hoping to finish current projects with the available funding.


Sign up for
LAWeekly newsletter. Get exclusive content today.