State budget officers report notable gain in transportation spending
November 27, 2019
States are spending more and more on transportation.
The National Association of State Budget Officers released a report this week that shows transportation spending by states in fiscal year 2019 to be about $170 billion.
Overall state government spending across the country increased to an estimated $2.1 trillion, or by 5.7%, in the fiscal year that ended in September. According to the report, the uptick from a year ago marks the biggest annual increase since the recession ended in 2009.
The amount of money earmarked for transportation grew at the highest rate of seven categories. The report shows that over the past year 18 states increased transportation spending from state funds by at least 10%.
As a whole, state transportation funding grew 8.9% year over year. The figure includes proceeds from bonds and federal funds routed to states.
State budget officers attribute the transportation spending increases to increased tax collections over the past two years. Specifically for transportation, some states are investing more money into infrastructure projects.
“The increase in transportation spending reflects the devotion of additional state resources to address the need for maintenance and infrastructure demands,” the group’s summary reads.
“Other” priorities ranked second in spending with a 7.5% increase. Lower education and higher education ranked fifth and seventh with increased spending of 4.7% and 3.5%, respectively.
The group found that states led by both political parties have prioritized transportation in recent years. Additionally, there are 32 states that have constitutional restrictions that dedicate transportation funds for transportation purposes.
Favored methods to increase transportation revenue are:
- Fuel tax rate increases.
- Imposing fees on alternative fuel vehicles.
Fuel taxes represent the largest revenue source for transportation funds at 39.8%. License and registration fees follow at 19.4%. Vehicle sales and use taxes account for 7.6%, and tolls are 1.5%. All other sources total 31.7%.
Some analysts anticipate transportation spending to continue to grow early next year as states look to address infrastructure needs before the focus shifts to election-year politics.
Other state funding news coverage
Work continues in Pennsylvania to identify and move forward with initiatives to aid transportation.
Transportation talks in Connecticut continue to evolve with truck-only tolls once again taking center stage.
A special panel in Maine is working to address a highway funding gap. Options expected to be pursued include a fuel tax increase, and tolls.