HTF Protects Our Transportation Infrastructure
Federal highway funds are invested in our nation's transportation infrastructure. In 2007 alone, Federal HTF receipts topped $39.9 billion, with $34.9 billion dedicated to the HTF's Highway Account.
FHWA administers the Federal-aid highway program, which apportions highway funds to states based on formulas established in federal highway authorization acts. The most recent authorization act is the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA–LU), which was signed into law on August 10, 2005.
SAFETEA–LU guarantees that each state's share of apportionments will equal 90.5 percent of its overall contribution to the HTF in 2005, with the minimum guarantee growing to 92 percent by 2008. Since the vast majority of all funds contributed by states to the Federal HTF are returned through highway fund apportionments, there is a direct incentive for state agencies to take necessary measures to enhance HVUT compliance.
HTF Finances a Broad Spectrum of Transportation Investments
- Highway improvements (e.g., land acquisition and other right–of–way costs, preliminary and construction engineering, construction and reconstruction, resurfacing and restoration costs of roadways and bridges)
- Highway and bridge maintenance activities
- Highway and traffic system costs (e.g., traffic control and surveillance systems, snow and ice removal, erosion control, air quality programs)
- Highway law enforcement
- Safety programs (e.g., driver education and training, vehicle inspection programs, enforcement of vehicle size and weight limitations)
- Congestion relief projects
- Debt service
- Administrative costs (e.g., overhead, research, engineering)
Highway Investment Drives Economic Growth
Recent studies conducted for FHWA demonstrate that highway investment has generated significant positive economic impacts for the nation, including those related to employment, income, productivity, production costs and private capital formation. A study prepared by Ishaq Nadiri and Theofanic Mamuneas found a strong link between highway investment and economic performance. Highlights of the report, which focuses on the 1950–1991 time period, include:
- U.S. industries realized average production cost savings of 29.4 cents for every dollar of highway investment
- Highway investment contributed 25 percent to annual productivity growth
- The average net rate of return on total highway capital investment is 32 percent annually6
The study demonstrates that highway investment continues to play a strong role in industry productivity growth, national economic performance and international competitiveness.
6Nadiri, I and T. Mamuneas, Contribution of Highway Capital to Output and Productivity Growth in the U.S. Economy and Industries, Report prepared for the Federal Highway Administration Office of Policy Development, Washington DC, August 1998.