Surface Transportation News: Funding state transportation projects when federal money runs out

In this issue:

• Preparing states for when the federal money runs out
• How personal travel has changed post-pandemic
• Why U.S. taxpayers should not pay for Maryland’s new bridge
• Road safety in the post-pandemic era
• California high-speed rail’s last-ditch effort
• Let’s reconsider commercializing Interstate rest areas
• News Notes
• Quotable Quotes

Preparing States for When the Federal Money Runs Out

For the past year and a half, I’ve written columns and chaired a conference panel on the looming insolvency of the federal government, which is now projected as early as 2033. When the Social Security and Medicare trust funds reach “empty,” Congress’s most likely choice will be to reduce all kinds of other federal spending in order to replace the 20%-25% shortfalls of those two entitlement programs’ annual funding. If Congress were instead to commit to filling the gap in entitlement funding via massive additional borrowing, forever, the U.S. government’s credit rating would move from investment-grade to junk, making debt service on the greatly increasing national debt even more expensive.

Yet, in the transportation world, Congress is gearing up to reauthorize the highway and transit program using the borrowed $674 billion added by the Infrastructure Investment and Jobs Act (IIJA) legislation as its baseline. Doubling fuel taxes to fund that spending increase is not even thought about in Congress, let alone being suggested by anyone as a wiser remedy than borrowing.

Yet, fiscally responsible members of Congress ought to be proposing reforms that would at least start to get state departments of transportation (DOTs) and state legislators to prepare for the day when federal transportation money is no longer available. This would be a massive, unexpected change, unless at least some transportation leaders start paving the way for this financial earthquake.

With that as an introduction, here are some provocative ideas from my friend and colleague, D. J. Gribbin, who drafted the White House infrastructure plan during the first term of the Trump administration. Gribbin recently published his thoughts on federal transportation funding in a short paper for the Eno Center for Transportation on Aug. 27. Gribbin sets forth several important points that could lay the groundwork for the major changes needed in federal transportation policy.

First, federal transportation trust fund money is not “additive,” Gribbin notes, meaning it all originates from state and local taxpayers (except for recent years’ egregious borrowing from future generations). Every state is entitled by law to receive back at least 95% of what it generates in federal user tax revenue.

Second, the prospect of getting “free federal money” at some future date can lead a state agency to hold off on launching a project that has some prospect of having a large fraction paid for by “the feds.” We have all seen state policymakers hold off on committing their own funds to needed projects, in hopes of future federal largesse.

Third, as we know but often ignore, federal funding increases a project’s cost. Davis-Bacon, Buy America, and all kinds of other rules and regulations make a project that gets federal dollars cost a good deal more than if it were entirely state (and privately) funded. D.J. cites a Government Accountability Office (GAO) study that in the 2014-18 period, found that a federal building cost 14%-25% more than if it had been state/local funded. He also cites a Georgia study finding that road widenings with federal money took four times longer to carry out than state-funded widening projects.

Finally, Gribbin cites a growing body of work that documents the large increase in highway construction costs due to the IIJA. Jeff Davis of Eno reported that construction cost inflation has consumed $57 billion of IIJA’s spending increase.

Based on these points, D.J. suggests several modest changes in federal law.

First, give each state a legal right to 95% of the Highway Trust Fund money that originated in that state. And then amend Title 23 so that those funds, since they are each state’s property, are exempted from all federal regulations.

Would Congress balk at such a change? Perhaps not, he suggests, because all the IIJA-type borrowed money would still be subject to the usual federal regulations and would be available for Members of Congress to earmark, as they love to do (at least while the borrowed money lasts).

This agenda would be a way to revive the highway funding devolution proposal that became popular in the 1990s, when it was endorsed by mainstream thinkers such as Alice Rivlin (Brookings Institution) and David Luberoff (Harvard Kennedy School). I wrote a 1996 Reason Foundation policy paper, “Defederalizing Transportation Funding,” and spoke about the subject at several conferences. Sen. Connie Mack (R-FL) and Rep John Kasich (R-OH) sponsored a bill that would have phased out, over two years, all but two cents of the federal motor fuel taxes. California Gov. Pete Wilson and the state’s 1996 Commission on Transportation Investment supported this devolution.

Discussing these kinds of ideas should get started now, so that state and local governments are not left unprepared when the Social Security and Medicare crunch occurs, as early as 2033. State and local governments own nearly all the U.S. roadway and transit systems. It is their responsibility, as owners, to ensure that these vital systems remain funded when the federal government is no longer able to be their backstop.

Transportation thought leaders need to engage on this vital subject because it’s clear that Congress apparently does not see this coming. Somebody needs to start thinking through the needed transfer of responsibility to the owners and operators of this infrastructure. If not us, who? And if not now, when?

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How Personal Travel Has Changed Post-Pandemic

How has commuting changed since the COVID-19 pandemic? How far has transit ridership recovered? How many of us are working at home full-time?

These are among the questions answered by two decades of data from five reputable transportation surveys. My colleague Steven Polzin of Arizona State University (and his ASU colleagues Ram Pendyala and Irfan Batur) have compiled these findings in both tabular and graphical form. Their graphical summary is now available. Here are some of the highlights.

From the 2024 American Community Survey (ACS) conducted by the U.S. Census Bureau, we find that commuting alone in a motor vehicle has declined from around 76% pre-pandemic to around 69% today. But those commuters did not shift to transit, whose average has declined from around 5% to around 3.7% in 2024. Walk, bike, and other modes are basically unchanged at around 4.5% (higher than transit’s share). Where former commuters and transit users went is to “working at home.” The ACS data show 13.3% working at home “usually,” compared with 3% to 5% pre-COVID. The American Time Use Study (ATUS) figure for “work at home always” is 19.6% (which has declined from 25% in 2020).

The graphical data adds additional information about what has changed since 2005. For example, average commute time increased pretty steadily from 25.1 minutes in 2005 to 27.6 minutes in 2018. But post-pandemic, it has climbed back from 25.6 minutes in 2021 to 27.2 minutes in 2024 (despite the smaller fraction of solo commuters). Far more dramatic is the average daily trips per person. That shows a steady downtrend from 4.2 trips in 2003 to 3.5 trips in 2018. That plunged to 2.5 trips during COVID but has slowly increased to 2.88 by 2024, basically continuing the long downtrend. The amount spent per day on travel also experienced a gradual downtrend from 2003 (75.3 minutes) to 2018 (69.4 minutes). After a large decrease during COVID, by 2024, it was up to 61 minutes.

One of the most surprising changes is what people are using their trip time for. Even back in 1990, commuting was only one-third as much as shopping and errands, per the ATUS data. But the shopping fraction by 2022 was half of what it was in 1990. And in 2022, total daily household travel, as measured by ATUS, had declined from 3.76 hours to 2.28 hours. It’s pretty obvious, as Polzin has written elsewhere, that travel time for shopping has been slashed due to online ordering and delivery, as well as home services partly substituting for things like trips to Home Depot. One graph in the presentation shows e-commerce retail sales having climbed from less than 1% of total retail in 1999 to over 16% in 2025.

Consistent with all of the above is the change in vehicle miles of travel (VMT). Between 1945 and 2005, VMT grew at 4.22% per year. Since then, after a dip 2008-2011, it resumed growing but at a significantly lower rate (apart from a COVID-19 dip). But the most dramatic change is in VMT per capita. During that same 1945-2005 period, it grew at 2.95% per year. But after peaking in 2005, it has been in a slight downtrend since then. This is consistent with the above data on things like reduced household travel.

The anti-highway/anti-car organizations still like to portray Americans as car-crazy people who get in their cars for anything and everything. They assume that adding lanes to congested freeways is futile, since there is a reserve army of drivers waiting to fill up every new lane-mile. But travel behavior has changed, thanks to trends like working from home, service delivery companies, and online retail sales and delivery. Transportation planning needs to take these major trends into account.

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Why U.S. Taxpayers Should Not Pay for Maryland’s New Bridge

Following the collapse of the Francis Scott Key Bridge last year after one of its piers was struck by a cargo ship, Maryland officials pulled out all the stops to get a pledge from Congress that taxpayers would pay for the bridge’s estimated $2 billion replacement cost. And to ensure a speedy replacement process, they announced that the new bridge (although a different design) would be built in the same location; hence, no years-long environmental impact study (EIS) would be needed.

That was then; this is now. First, we learn that, based on a preliminary design by the planned contractor, the replacement will cost $5 billion, rather than the initially estimated $2 billion. And second, the bridge will follow a different route than the original bridge (but never mind about no need for an EIS). Congress should not fall for this bait-and-switch. Taxpayers in 49 other states should not be stuck with a $5 billion tab for this project.

In fact, the case for federal taxpayers to pay for the bridge at all is very weak. As I pointed out in the aftermath of the Key Bridge collapse, that bridge was a toll bridge, and there is no reason to ignore the users-pay principle for its replacement.

Second, while realistic toll revenues would very likely fall short of paying for a $5 billion bridge, Maryland has a number of other funding sources. The bridge was insured against the loss of toll revenue via a $350 million policy, so that is one source. The company that operated the ship that collided with the bridge was also insured. As The Wall Street Journal reported at the time, it was insured by Britannia P&I Club, one of a dozen such maritime insurance clubs. Those clubs pool their resources in the event of a major disaster, and up to $3.1 billion is available per ship.

In addition, it’s very clear that Maryland officials dropped the ball on the need for heavy-duty protection of the bridge piers. The Maryland Transportation Authority ignored repeated warnings over the years from the Baltimore Harbor Safety and Coordination Committee about the lack of meaningful protection of the bridge piers. So it was not an innocent victim of the bridge collapse. This negligence suggests that Maryland taxpayers should bear part of the cost of the replacement bridge.

Let’s hope members of Congress from the other 49 states resist Maryland’s new drive for a $5 billion federal windfall. The federal government is operating at a huge budget deficit, and $5 billion is hardly spare change.

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Addressing Road Safety in the Post-Pandemic Era
By Marc Scribner

In the last half-decade, the United States experienced the most dangerous roads in years. The National Highway Traffic Safety Administration (NHTSA) reports that nationwide traffic fatalities exceeded 40,000 in 2021 for the first time since 2007. Accounting for the growth of the population and travel yields similar results in terms of fatality rates. This traffic safety problem spurred many dramatic policy proposals, most of which failed to deliver any safety benefits. The good news is that the recent surge in dangerous driving seems to have subsided. But questions about the role of public policy in improving roadway safety will continue and should be informed by evidence and realistic assumptions.

The onset of the COVID-19 pandemic coincided with a rise in what could be generally termed “bad behavior.” In the United States, increasing violent crime in major cities received the most public attention, but other examples abound. Public health agencies observed substantial increases in substance abuse and overdose deaths. In transportation, a troubling outbreak in “air rage” incidents on commercial airliners coincided with the air travel recovery. Pilot-reported “laser incidents” also dramatically increased during this period. America’s roadways were not spared.

The fatality rate per 100 million vehicle-miles traveled increased by 22% between the third quarters of 2019 and 2020, marking the highest fatality rate since 2005. This period coincided with relaxed pandemic restrictions while commuter travel remained minimal due to working from home, which opened up many previously congested roads for high-speed misbehavior. Traffic enforcement by police also fell, in part due to public health concerns about maintaining social distancing.

Both the number of traffic fatalities and the fatality rate have declined steadily from their peaks over the last few years. Last month, NHTSA released its initial estimate of U.S. traffic fatalities for the first half of 2025. In very welcome news, the fatality rate of 1.06 deaths per 100 million vehicle-miles traveled is lower than the 1.07 deaths observed in the first half of 2019, suggesting that the pandemic era of roadway carnage may be behind us.

So what might explain this recent positive change in road safety? Urban traffic congestion came roaring back in metropolitan areas across the country, limiting opportunities for high-speed misbehavior. Renewed emphasis on high-visibility enforcement by law enforcement might play some role, although there isn’t strong evidence to support this claim.

What about engineering infrastructure to be safer? Supporters of this approach generally advocated traffic-calming measures whereby the design of roads was to be modified to encourage drivers to alter their behavior. Changes such as narrower roadways and lanes have been widely demonstrated to reduce driver speeds. Unfortunately for traffic-calming advocates, re-engineering roadways is the most costly and time-consuming type of safety intervention, so it is unlikely to have been responsible for the recent decline in dangerous driving to pre-COVID levels.

Further, in addition to the high costs and time-consuming nature of traffic-calming interventions, these programs in practice have often been poorly targeted. For instance, the 2021 Infrastructure Investment and Jobs Act established a grant program called Safe Streets and Roads for All (SS4A). SS4A aimed to fund Complete Streets traffic-calming projects favored by urbanists. But as I noted in the June 2022 issue of this newsletter, because SS4A eligibility criteria were overly focused on relatively safe urban streets owned by municipalities, the program in practice prohibited funding to the U.S. roadways where more than half of fatalities occur. If the goal was to make a material difference in the safety outcomes on America’s most dangerous roadways, SS4A failed spectacularly by its own poor design.

I’m no psychologist, but my strong suspicion is that Americans’ bad behavior has demonstrated something like a reversion to the mean in the years since the initial shock of the COVID-19 pandemic. This has been observed in violent crime, unruly airline passengers, substance abuse and overdose deaths, and even aircraft laser strikes. So why not misbehavior by motorists, too?

It has long been known that the critical factor in the vast majority of motor vehicle crashes is driver behavior, whether error or misdeed. The implementation of behavioral-focused traffic safety countermeasures, such as those catalogued and evaluated by NHTSA, has historically proven successful in reducing crashes and the injuries and fatalities caused by them.

However, in the years immediately before the pandemic, traffic fatality rates had plateaued. This led to growing concern among policymakers that the “low hanging safety fruit” had been picked, a dubious assertion given that U.S. traffic safety policy often neglects the centrality of driver behavior. Nevertheless, this led some to suggest that improving road safety in the future means advancing the most-costly, less-immediately-effective, and often-unpopular interventions. These interventions, such as traffic calming, often present stark trade-offs between road network efficiency and safety.

Fortunately, automated vehicle technology increasingly being deployed in various forms might be as close to a safety silver bullet as we can get. Fully automated driving directly addresses driver behavior—the critical factor for more than 90% of crashes—by assuming responsibility of the dynamic driving task. And it does so in a way that minimizes public expense with the potential to also improve traffic flow, rather than sacrificing roadway efficiency for safety through costly and gradual infrastructure treatments.

Automated driving developer and robotaxi operator Waymo has analyzed 96 million miles of driverless operations and persuasively estimates its technology has produced 91% fewer serious-injury or worse crashes and 80% fewer any-injury crashes compared to a human driver baseline. To be sure, many of these driving automation technologies are not in widespread use—especially the most advanced automated driving systems that completely remove human beings from the driving loop—and they will take time to mature and deploy at scale. But we may be on the cusp of realizing unprecedented traffic safety improvements. This is something Congress should consider as it works to develop the various programs contained in its surface transportation reauthorization due next year.

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California High Speed Rail’s Last-Ditch Effort
By Baruch Feigenbaum

High-speed rail (HSR) has proven to be very expensive to build in the United States. A taxpayer-funded line in Florida was vetoed years ago, and today, there is the less-expensive but still costly public-private Brightline project. A proposed, privately funded high-speed rail project in Texas connecting Dallas and Houston sits in a zombie state, waiting for funding. But the original and most expensive project of them all—California’s planned high-speed rail line between Los Angeles and San Francisco—is still alive. The project’s existence has more to do with political convenience than transportation needs.

Last month, Gov. Gavin Newsom and California legislative leaders reached a general agreement to provide long-term funding for the high-speed rail (HSR) line from the Cap and Invest (previously known as Cap and Trade) program. While that might sound encouraging, this new funding plan relies on some creative accounting that doesn’t exactly meet the standards of the Government Accounting Standards Board.

As Jeff Davis at Eno Transportation Weekly first reported, the combination of scope increases, cost escalation, closeout costs, and completed designs would virtually double the starter segment’s cost from $26 billion to $51 billion. At the same time, the Trump administration has clawed back $4.1 billion in federal funding that was previously awarded by the Biden administration. As a result, the California High-Speed Rail Authority (CHSRA) needs to close a significant budget hole.

The state identified design and sequencing changes that it says would reduce the cost of the Merced to Bakersfield starter section of the rail system by $14 billion. It also plans to close the gap by extending the timeline of the Cap and Invest funding from 2030 to 2045, but that would cause delays in construction.

As a result, the state is trying to identify expansions beyond the starter segment that might yield an operating profit to help finance the expanded project. The authority is examining expanding the starter segment northward, southward, and eastward. The most viable option it could find is a San Francisco to Palmdale route, which might yield $11 million in operating profit over 40 years. But those extensions would cost another $60 billion to construct.

In reality, this new budget is an accounting shell game. It tries to use revenue generated from operating services without counting shortfalls incurred from construction costs.

But given California’s existing transportation network and decisions other states have made regarding HSR, it is worth asking why California is still pursuing this project. And the answers are less compelling than they were 15 years ago.

High-speed rail isn’t a big win for the environment. High-speed trains operating at capacity between L.A. and S.F. would produce fewer greenhouse gas emissions than half-full airplanes flying between the same regions. But the trains would not reach the line endpoints until at least 2050. And there is no indication that they will be full.

Meanwhile, most airlines fly inter-California routes at 90% capacity. Aircraft engines are becoming more efficient; several electric and hybrid aircraft propulsion systems are under development. And building an HSR line is extremely energy-intensive, much more than the construction of a new airport or highway. The irony of using Cap and Invest dollars meant to remediate energy-intensive uses for the energy-intensive construction of HSR is apparently lost on California decision-makers.

It’s also not clear why California needs high-speed rail. Airplanes are faster and don’t require taxpayer subsidies. An intercity bus provides a budget option. And driving is the customizable option for folks traveling outside the city centers or who need to stop between the central cities.

Other countries built their HSR network for two reasons. The first was to relieve crowding on conventional passenger rail systems. There is no conventional passenger rail between LA and San Francisco, and hence no overcrowding. The second was to stimulate development before they had a limited-access highway network. California already has a robust freeway network, including I-5 and US 101, connecting Southern and Northern California. Widening I-5, where needed, wouldn’t be cheap, but it would be a fraction of the cost of HSR.

Using general fund revenue (which Cap and Invest is) to build HSR is a wealth transfer from the working class to the business class. Trains often have roomier seating and better food options, but taxpayers subsidize those perks. All but three high-speed rail lines worldwide have required subsidies to build, and many require subsidies to operate.

Contrast high-speed rail with local transit, particularly local buses, which are used most by lower-income residents. While government subsidies should always be minimized, there is more justification for subsidizing local lower-income transit riders who might not be able to access employment without the service.

From a political perspective, it may seem an odd policy for Democrats to support a project for the wealthy. What makes it potentially politically savvy in California is the number of jobs the project can provide to unions, which have typically been a core constituency of the Democratic Party, and the illusion that the project reduces greenhouse gas emissions in the short term, which the environmental wing of the party supports. But that doesn’t make the rail system a good policy for taxpayers or the state’s future. Perhaps this latest creative accounting is so egregious that some Democrats in the state legislature will pull the plug on the project.

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Let’s Reconsider Commercializing Interstate Rest Areas

Last month, I received an email from a corporate official who had just discovered Reason’s 2021 policy study, “Rethinking Interstate Rest Areas.” It made the case, based partly on the minimal facilities at Interstate rest areas (forbidden by law to offer any commercial service), partly on the need for safer overnight truck parking spaces, and partly on the then-emerging need for electric vehicle charging stations. His email suggested that, given limited state and federal highway funding, perhaps it is time to revive this idea.

The context in 2021 was the Biden administration holding the presidency and Democratic majorities in both the House and Senate. We made common cause with groups working hard to legalize EV charging at rest areas, and at one point, it looked likely to be included in pending legislation. But opposition from the trucking and truck-stop industries (plus the organization of fast-food franchisees whose locations at on-ramps and off-ramps felt threatened by rest area competition) killed the effort.

Today, the safe overnight truck parking shortage remains in play, and while EV charging has increased, it would be much more convenient for range-anxious drivers to know they could charge up at Interstate rest areas. Plus, we are in a very different political environment, with the opposite party in control of the White House. I was recently reminded that the 2018 Trump White House infrastructure proposal included both expanded Interstate tolling and commercializing Interstate rest areas.

So what might increase the prospects this time around? First, many state DOTs would like to expand truck parking but can’t afford to expand the small acreage of their existing rest areas—which any of the companies that develop and operate toll road service plazas would be glad to do. A number of state DOTs favored repealing the ban on commercialization four years ago, and very likely still do.

Second, the trucking industry is not uniformly opposed. In the roll-out of our 2021 study, I learned that the Owner-Operator Independent Drivers Association (OOIDA), the organization of owner/operator truckers, has long favored commercialization. (I made a guest appearance on their radio program to talk about this.) Potentially very important is that two of the major truck stop operators—Pilot and Flying J—as of 2024 are wholly owned by Warren Buffett’s Berkshire Hathaway, a champion of free markets and competition.

Third, one possible sweetener for both the breadth of services at rest areas and the expansion of truck stops would be for state DOTs to include not only expanded safe overnight parking but also truck-stop-like facilities such as showers and trucker-friendly retail. Indeed, some commercialized rest areas might offer to host truck stops as part of their commercial expansion.

The economic case made against commercialized rest areas reflects a zero-sum view of the world. Any new service offered at a rest area is assumed to deprive that amount of service from a gas station or fast-food outlet at an off-ramp. Since trucking is projected to be one of this country’s fastest-growing businesses in the coming decades, that zero-sum view is wrong. But it’s also (how can I put this) anti-American. In a free-market economy, any business must expect competition and has no right to expect the government to prevent it. Yet that is what the federal ban does. Moreover, the opponents of commercialization are not companies such as Burger King or Coca-Cola—they are associations of franchisees of such companies. Advocates of rest area commercialization should recruit the big-name companies that eagerly offer their services at toll road service plazas and would be glad to do likewise at commercialized rest areas..

Reason’s 2021 study has lots of still-useful information for policymakers and the transportation industry.

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News Notes

Company to Auto Producers: Get a Horse!
Making its debut at last month’s annual Munich Motor Show was a 1.5-liter engine designed to enable auto manufacturers to convert their electric vehicles (EVs) to hybrids. Called the Horse C15, it is the size of a large briefcase. Its four cylinders deliver up to 94 horsepower for B and C-segment vehicles. A larger 161-horsepower version is available for larger cars. Horse says the C15 can run on gasoline, ethanol, or methanol flex fuels. With EV sales tapering off and hybrids in many markets out-selling pure EVs, Horse might have a viable product, depending on its price and installation cost.

Waymo Gets Permit for San Francisco Airport
Last month, city officials announced that Waymo was receiving a permit to take passengers to and from SFO, the Bay Area’s largest airport. The move enables SFO to compete better with San Jose Mineta International Airport, which announced that its Waymo service will launch by the end of the year. With no driver costs, the Waymo service is expected to be less expensive than taxis and ride-hailing companies such as Lyft and Uber. No start date was announced for Waymo at SFO, but that is also unlikely to begin until the end of this year.

IBTTA Supports User-Based Funding in Federal Reauthorization
In a recent news release, the International Bridge, Tunnel, and Turnpike Association (IBTTA) has recommended that Congress strengthen user-based highway funding when it reauthorizes the federal highway program next year. Given the huge and growing shortfall in the federal Highway Trust Fund, IBTTA called for expanding the scope for tolling and road pricing on Interstates and other federal highways. It also called for streamlining project delivery via full implementation of the One Federal Decision policy and advancing alternatives to fuel taxes, such as mileage-based user fees (MBUFs).

Congress Takes Another Look at Federal EV Fee
While a growing number of states have some kind of a tax or fee on electric vehicles, at the federal level, EVs pay no federal highway user taxes, unlike conventional motor vehicles. Lacking an easy way for the federal government to charge some 289 million vehicles for their annual miles driven, the simplest option appears to be a flat annual fee/tax. This would presumably be collected by state motor vehicle departments and remitted to the federal Highway Trust Fund. There is still talk about charging $250/year for EVs and somewhat less for hybrids. The average personal motor vehicle pays $100-150/year in federal fuel taxes, so $250 seems excessive, despite the somewhat higher weight of EVs compared with comparable internal combustion vehicles. $150 would seem more like it, perhaps with an adjustment for gross weight and inflation.

More Ports for Panama Canal Proposed
The Panama Canal Authority plans to auction two greenfield ports, as it continues to counter fears of undue Chinese interest in the Canal. The agency hopes to have two new operators selected by year-end. Those known to be preparing to do so include European companies CMA-CGM and AP-Moller-Maersk, according to Infralogic (Aug. 27).

Florida Continues Expanding Its Toll Roads
With more tolled lane-miles than any other state, according to Federal Highway Administration (FHWA) data, fast-growing Florida continues to expand its toll roads. For example, in the Tampa Bay area, the Selmon Expressway (which includes a reversible upper deck for faster suburbs-to-downtown commuting) has public support to extend the expressway eastward to the suburb of Riverview. Recent surveys show 95% support in that suburb. And in the Jacksonville metro area, the First Coast Expressway continues to expand westward, with current plans calling for it to grow to 46 miles. The Expressway will provide a shortcut between I-10 and I-95 once a new bridge over the St. Johns River is completed.

Virginia Express Toll Lanes Missing Link
Oct. 15 is decision day for Virginia DOT and the Metropolitan Washington Council of Governments. The latter’s Transportation Planning Board will vote on whether to move forward with the extension eastward of the existing express toll lanes network, by including it in the regional Visualize 2050 transportation plan. If that decision is yes, whether or not the project (I-495 Southside Express Lanes) will be procured as a long-term public-private partnership (P3) will remain to be decided. That will depend on whether projected revenues would be enough to support a revenue-financed P3 procurement. That depends, in part, on whether Maryland planners approve extending the lanes across the Woodrow Wilson Bridge to MD 210 in Prince George’s County.

India Planning 68-Mile Elevated Toll Road
The New Indian Express reported that the Greater Bengaluru Authority’s technical committee has approved a detailed report on a new cross-city elevated toll road. It would be procured as a long-term public-private partnership, as many Indian toll roads have been. The toll road would have entry and exit ramps at strategic locations.

Brightline West Revamping Its Financing
Infralogic’s Stephen Pastis reported (Sept. 5) that Brightline West is updating the financing plan for its proposed 218-mile high-speed rail line from Las Vegas to Rancho Cucamonga in San Bernardino County, California. CEO Mike Reininger said the company will finalize contracts with construction firms within the next 90 days, enabling the company to finalize its financing. Pastis reported that the company will increase its equity investment to “well above” the previous $1 billion in earlier plans. The revised financing will also require more debt. The company had an Aug. 31 deadline to secure $6 billion in senior debt financing and is now within a 90-day grace period to revise its financing plan.

Queensland Government Cancels Light Rail Project
A long-planned project to extend an existing light rail line by 13 km to Brisbane’s southern suburbs, whose cost had escalated to an estimated A$9.85 billion, was terminated early last month. Community support ended up largely negative, due in part to only light rail being considered, objections to its impact on a national park and popular creek, and likely further cost increases. The government promised to embark on a multimodal study taking greater account of public concerns.

Tolls Removed: Congestion Blossoms
Highway 407 ETR is a P3 toll road in the Toronto suburbs, and it was one of the first large-scale transportation P3 projects in Canada. It was an extension of the existing state-operated 407, which was also financed based on tolls. On Aug. 14, the premier abruptly abolished tolling on the state-operated portion, and significant congestion appeared. Interestingly, Green Party leader Mike Schreiner criticized the government for removing pricing, which encouraged far more people to drive.

Reduced Bridge Tolls Agreed for Strait Crossing
Infralogic’s Eugene Gilligan reported (Aug. 25) that Transport Canada and Strait Crossing Bridge Limited (SCBL) had agreed to reduce tolls on the Confederation Bridge. Infrastructure P3 company Vinci owns 85% of SCBL, which has the P3 concession that developed the bridge, and which runs until 2032. Transport Canada negotiated the toll reduction agreement, from $C50.25 to $C20 for all vehicles until 2032, but also agreed to subsidize SCBL to make up for lost toll revenue. The bridge is eight miles long and connects Prince Edward Island with New Brunswick. It was developed by a previous P3 consortium, starting in 1993 and completed in 1997.

Luxury EV Charging Stations in the Los Angeles Area
The Economist reported that Los Angeles now has two luxury EV charging stations. One is the Tesla Diner, with sleek, retro-science fiction architecture and food served in boxes shaped like a Tesla Cybertruck. A competitor has opened in nearby Orange County, competing with diner Rove; it includes an on-site lounge and an upscale grocery store. This concept will work as long as it takes 20 to 30 minutes to charge an EV, so people need something else to do. If or when super-fast charging comes about, then any gas station could be converted to an EV charging station.

New York State Thruway Goes Electronic
Despite being a latecomer to the all-electronic tolling trans, the Thruway seems to be doing an excellent job. The International Bridge, Tunnel, and Turnpike Association (IBTTA) reports that, in 2024, 95% of all Thruway tolls were collected via E-ZPass, with toll revenue topping the $1 billion level. The numbers are derived from the agency’s audit of 2024 operations..

Correction to Last Month’s Lead Article
The article on China’s high-speed rail excesses came to me from a D.C. think tank, CSIS. But last week I heard from Zichen Wang, who writes the Pekingnology newsletter on Substack. It was his post that I discussed, but CSIS did not originate it (although it did host a recent podcast from him). He works for the Center for China and Globalization in Beijing, a non-governmental think tank. He also explains that he is a journalist, not a transportation expert, and that he recently posted a rebuttal to the Lu Dadao criticism.

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Quotable Quotes

“Based on projected fuel-efficiency gains, the federal gas tax revenue will lose $3.9 billion (16% decline) in 2030 alone. Over 80 percent of that loss is because vehicles are going farther on a tank of gas. Although EVs are not the primary cause of the revenue problem today or in 2030, as EV adoption accelerates, our ability to rely on fuel taxes will further erode. The billions lost is a jaw-dropping number, but it is invisible to users of the road, as we never receive a bill for transportation cost. Rather, taxes on our fuel are baked into the price at the pump. As wrapped up as Americans are in driving, we are largely oblivious to how roads are paid for.”
—Patricia Hendren, Eastern Transportation Coalition, in “Transportation at a Crossroad: User Fees, Emerging Technology, and the Value of Transportation,” Eno Center for Transportation, Aug. 27, 2025

“Current federal fuel taxes average about $100-124 per year per personal vehicle—often less than one’s monthly bill for internet and cell phone service. While mileage-based user fee concepts will mature over time, administrative costs and outstanding issues regarding deployment prevent them from being near-term solutions. If we want to build big, beautiful stuff, we should not dump more debt on future generations.”
—Steven Polzin, Arizona State University, “As Travel Changes, So Must Transportation Governance,” Eno Center for Transportation, Aug. 27, 2025

“Let’s be candid about [environmental] litigation. Challenges to project approvals cost time and money. More importantly, litigation risk creates uncertainty for project development, especially for those supported by private-sector investment. Reauthorization is not the best vehicle to debate how much or how little litigation should be permitted. But Congress could create a streamlined litigation process for challenges to surface transportation projects. The statute of limitations for lawsuits addressing projects funded by federal aid should be 150 days, without exemption. Legal challenges should skip federal trial court and go directly to the federal appellate court, like most major rulemaking challenges. Even these modest reforms could reduce the uncertainties created by litigation.”
—Fred Wagner, Jacobs, “Improvements to Project Review and Permitting Built on a Solid Foundation,” Eno Center for Transportation, Aug. 27, 2025

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The post Surface Transportation News: Funding state transportation projects when federal money runs out appeared first on Reason Foundation.

Source: https://reason.org/transportation-news/preparing-states-for-when-the-federal-money-runs-out/