Funding the Interstate Highway System

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The 48,000-mile Interstate Highway System connects all corners of the United States with high-speed, limited-access roadways. Funding for new construction and ongoing maintenance comes from taxes on vehicles, tires, and -- mostly -- fuel. But as cars get more efficient and drivers shift to hybrids and electrics, gas tax revenues get smaller. Highway funds shrink as the costs of caring for an aging system grow.

Map Showing Travel and Transportation Routes between the Atlantic Coast and Missouri River of 1750-1825, Printed 1915

America's first roads were a poorly funded jumble. Highways were considered local responsibilities, which meant that routes were inadequately financed and haphazardly built. Improvements were uncoordinated and disconnected, and maintenance beyond municipal boundaries was nonexistent.

"The Old Pike: A History of The National Road and Incidents, Accidents, and Anecdotes Thereon," 1894

The National Road, authorized by Congress in 1806, was America's first large-scale experiment with federal highway building. The toll-free road connected Baltimore with St. Louis, by way of Cincinnati and Indianapolis. The National Road was built to high standards for its day, with a broad roadway 30 feet wide and gentle gradients no steeper than four percent.

Conestoga Wagon, circa 1840

The National Road made it possible to ship manufactured goods west, and agricultural produce east, by wagon at reasonable rates. But privately built railroads, which began to spread in the 1830s, proved more efficient, more reliable, and less expensive. The rise of railroads effectively shifted overland transportation infrastructure from the public sector to the private sector.

Cyclist Margaret Kirkwood with a Bicycle, circa 1890

Roads returned to the spotlight with the bicycle craze of the 1890s. Cyclists launched a coordinated Good Roads Movement to advocate for government-sponsored improvements to rural roads. Some municipalities instituted bicycle license fees and used collected money to finance construction and maintenance of better roads.

Mail Wagon Used for Rural Delivery in Missouri, 1902-1925

In 1902, the United States Post Office fully implemented its Rural Free Delivery (RFD) program to deliver mail directly to rural homes. RFD service encouraged farmers to join bicyclists in the Good Roads Movement, as better rural roads meant better, more reliable mail service.

Ford Model T Town Car Stuck in Mud, circa 1911

Americans' rapid adoption of the automobile -- particularly after the Ford Model T arrived in 1908 -- meant even greater support for road improvements. Auto clubs and organizations like the American Automobile Association (AAA) lobbied state and federal legislators to fund and maintain a proper national highway network.

"Strip Map of Lincoln Highway," 1929

While legislators debated, private trail associations emerged. Funded largely by contributions from auto manufacturers and suppliers, these associations created their own marked highways throughout the United States. The grandest was the Lincoln Highway, dedicated in 1913. It ran from New York City to San Francisco -- America's first coast-to-coast highway.

U.S. Route 1 Sign, circa 1950

The Federal-Aid Highway Act of 1921 formally put the United States government back into the road-building business. The act called for a national system of numbered routes marked with uniform signage. Odd-numbered routes, like U.S. 1, ran north to south, while even-numbered routes, like U.S. 66, ran east to west.

"A Colorful Souvenir Book of the Pennsylvania Turnpike System," circa 1952

Growing traffic called for still better, safer roads. The Pennsylvania Turnpike became the prototype for the modern limited-access highway. Financed by user tolls and opened in 1940, the turnpike ran 160 miles between Harrisburg and Pittsburgh. It was soon extended another 100 miles east to Philadelphia. Drivers appreciated the smooth pavement, wide lanes, and absence of at-grade intersections.

"The National System of Interstate and Defense Highways," 1964

Partly inspired by the Pennsylvania Turnpike, Congress passed the Federal-Aid Highway Act of 1956. It called for a 41,000-mile national Interstate Highway System built to similar high standards. The network, as originally envisioned, was completed in 1992 at a total federal cost of $114 billion. It remains the largest public works project in history, and it continues to grow.

1952 Federal 45M Truck Tractor, Used by Cole's Express

Instead of charging tolls, Congress financed the Interstates by taxing motor vehicles, tires, and fuel. Additional annual fees were charged to operators of large trucks -- heavy users of the Interstate Highway System. Collected money went into in a federal Highway Trust Fund. Small portions of the fund were also used to support mass transit projects.

"Penna Turn-Pike, Tips for Your Turnpike Trip," circa 1970

The federal government paid 90 percent of the costs for new Interstate highways, with states paying the remaining 10 percent for routes within their respective borders. Some existing toll roads, like the Pennsylvania Turnpike, were merged into the Interstate Highway System. States were allowed to continue charging tolls on these segments, but most of the system was toll-free.

1956 Chevrolet Bel Air Convertible

Financing Interstates with fuel taxes was a sound idea in the 1950s. Cars and engines were big. This 1956 Chevrolet Bel Air, with its V-8 engine and two-speed automatic transmission, averaged about 14 miles per gallon. That meant a lot of trips to the gas pump -- and a steady flow of money into the Highway Trust Fund.

1978 Dodge Omni Sedan

Oil supply crises in the 1970s sent gas prices skyrocketing, and consumers demanded better fuel economy from their cars. This 1978 Dodge Omni, with its four-cylinder engine and three-speed automatic transmission, averaged about 28 miles per gallon. Better mileage meant fewer trips to the pump -- and less money going into the Highway Trust Fund.

2002 Toyota Prius Sedan

By the early 2000s, environmental concerns strengthened the call for greater fuel economy. Gas-electric hybrid cars like this 2002 Toyota Prius averaged better than 40 miles per gallon, and fully electric cars used no gas at all. Fuel efficiency hit the Highway Trust Fund's bottom line. In 2008, Congress had to transfer additional money into the fund to keep it solvent.

Harbor Freeway in Los Angeles, California, 1956

The highway funding gap came at a critical time. By the mid-2010s, portions of the Interstate Highway System had been in service for 60 years or more. Some 1,800 of its bridges were classified as "structurally deficient" -- safe but needing repair or careful monitoring. Maintenance costs were climbing as highways and bridges aged.

"The Road Ahead, the Exciting Story of the Nation's 50 Billion Dollar Road Program," 1956

It's often easier to fund exciting new construction projects than it is to finance maintenance of existing structures. The Interstate Highway System is no exception. Early enthusiasm cooled as the Interstates matured. In recent years, policy experts have suggested various ideas for securing the Interstate Highway System’s fiscal health. Each proposed solution has its pros and cons.

Mobil Gas Pump, 1946-1960

One proposed funding solution is simply to raise the fuel tax. The federal gas tax is a fixed amount (18.4 cents per gallon since 1993). It's not a percentage, so it doesn’t increase as the price of gas climbs. Increasing the tax would boost income and do so in a way that works with existing revenue collection methods.

Texaco Gas Station, Santa Fe, New Mexico, 2003

But changes to the federal gas tax require legislative action by Congress, and tax increases usually aren't popular with voters. Americans accepted fuel taxes more willingly in the 1950s when the benefits of new Interstate highways were more obvious. Rural voters could be especially resistant -- most modern highway construction and maintenance projects benefit urban areas.

I-PASS Electronic Toll Pass Transponder, circa 2006

Charging tolls on Interstate highways could plug the funding gap. Tolls were effective on pre-Interstate projects like the Pennsylvania Turnpike and portions of the Illinois Tollway, where they paid for construction and upkeep. Electronic toll collecting technologies make the process more convenient for motorists, and more cost-effective for highway departments, than ever before.

Merritt Parkway Tollbooth, circa 1950

But American motorists have a longstanding and deeply ingrained resistance to tolling -- especially after driving so much of the Interstate Highway System toll-free for several decades. Drivers might seek alternate routes to avoid tolls, which would increase congestion on parallel roads.

Speedometer and Mileage Recorder, circa 1910

Another possible funding solution is a mileage tax -- charging drivers based on the distance they travel rather than the gasoline they use. The mileage tax would protect Highway Trust Fund revenues from changes in fuel efficiency and fuel types. It could also encourage more careful trip planning by motorists and more efficient use of roads.

Ford Speedometer, 1915

But monitoring mileage conflicts with Americans' traditional concerns about privacy. This new funding model would also require a complicated transition from our existing fuel tax method. Although mileage-tracking technologies exist, it would be difficult and expensive to install them in every motor vehicle in the United States.

2016 General Motors First-Generation Self-Driving Test Vehicle

Autonomous vehicles may make a mileage tax more practical. Their navigation systems could record miles traveled and transmit that data to a central agency, where fees could be calculated and collected. But that doesn't ease privacy concerns -- an issue that already has some motorists suspicious about self-driving cars.

Sign, Commemorating the Opening of Indiana Interstate I-94, 1972

The Interstate Highway System contains only four percent of America's public roads, but it carries more than 40 percent of the nation's highway traffic and 70 percent of its truck freight traffic. Funding methods for the Interstates are open to debate, but our dependence on them is not. Our future mobility is just as dependent on solving the highway funding dilemma.

Keywords	interstate highways Map automobile toll houses travel
Themes	Mobility

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