Transportation Funding

Transportation is vital to every aspect of our economy and our personal lives. Highways, transit systems, railroads, and other modes of transportation serve to knit our region together and connect it with the nation and the world. SEMCOG has a vital role in the transportation planning process as the region’s federally-designated Metropolitan Planning Organization (MPO).

Operating and maintaining a first-class transportation system is very expensive, so funding is always a critical priority. SEMCOG is in the forefront of many aspects of transportation funding, including financial forecasting, researching innovative ways to pay for needed improvements, and ensuring that adequate funding is available for proposed projects.

The non-local road system and the transit system are mostly funded by a combination of federal and state funding, although special assessments, bonds, and other sources of funding are also used.  A new federal transportation law, MAP-21, was passed in 2012.  For information about how MAP-21 funds transportation projects, please click on the following links: 

• Federal Highway Administration (FHWA)
• Federal Transit Administration (FTA)

The current method for raising federal and state funds for transportation is a fuel tax.  The federal and state fuel taxes are excise taxes, meaning that the same rate is charged per gallon, regardless of the price of gasoline and diesel fuel. Because the tax rate is not indexed to inflation, and because people are driving more fuel-efficient vehicles, the amount of money received from these taxes is no longer sufficient to adequately fund the transportation system. As a result, our roads and bridges are deteriorating at a faster rate than they can be repaired. 

Funding Local Road Projects: A Guide for Local Elected Officials (PDF, 192 KB) 

Additional Materials