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FHWA Home / Policy & Governmental Affairs / 2004 Conditions and Performance

Conditions and Performance

2004 Conditions and Performance: Chapter 6 (Summary)
Status of the Nation's Highways, Bridges, and Transit:
2004 Conditions and Performance
Chapter 6 Finance
  • Summary
    • Highways and Bridges
    • Transit
  • Highway and Bridge Finance
    • Revenue Sources
    • Historical Revenue Trends
    • Highway Expenditures
      • Types of Highway Expenditures
      • Historical Expenditure and Funding Trends
      • Constant Dollar Expenditures
      • Constant Dollar Expenditures per VMT
    • Highway Capital Outlay Expenditures
      • Capital Outlay by Improvement Type
  • Transit Finance
    • Transit Funding
    • Level and Composition of Public Funding
    • Federal Funding
    • State and Local Funding
    • Level and Composition of System-Generated Funds
    • Trends in Public Funding
    • Funding in Current and Constant Dollars
    • Flexible Funding
    • Capital Funding and Expenditures
    • Operating Expenditures
    • Operating Expenditures by Transit Mode
    • Operating Expenses by Type of Cost
    • Financial Efficiency
    • Cost Effectiveness
    • Rural Transit
  • Innovative Finance
    • Credit Assistance
      • TIFIA
      • State Infrastructure Banks
    • Debt Financing
      • GARVEE
    • Public-Private Partnerships


Exhibit 6-1 compares the key highway and transit statistics discussed in this chapter with the values shown in the last report. The first data column contains the values reported in the 2002 C&P report, which were based on 2000 data. Where the 2000 data have been revised, updated values are shown in the second column. The third column contains comparable values, based on 2002 data.

Exhibit 6-1 Comparison of Highway and Transit Finance Statistics with Those in the 2002 C and P Report
Statistic 2000 Data 2002 Data
2002 C&P Report Revised as
of 12/23/04
Total Funding for Highways (all govts.)$128.7 bil$131.1 bil$134.8 bil
Total Funding for Transit$30.8 bil $36.5 bil
Total Public Funding for Transit$21.0 bil $26.6 bil
Percent of Public Funding for Transit Funded by Federal Government25% 23.7%
Total Highway Expenditures (all govts.)$127.5 bil$122.7 bil$135.9 bil
Percent of Total Highway Expenditures Funded by Federal Government21.7%22.4%24.1%
Total Highway Capital Outlay (all govts.)$64.6 bil$61.3 bil$68.2 bil
Percent of Total Highway Capital Outlay Funded by Federal Government39.9%42.6%46.1%
Percent of Total Highway Capital Outlay Used for System Preservation52.0% 52.6%
Total Transit Capital Outlay$9.0 bil $12.3 bil
Percent of Total Transit Capital Outlay Funded by Federal Government47% 40.6%
Percent of Total Transit Capital Outlay Used for Rail63% 71%
Total Highway-User Revenues (motor-fuel and vehicle taxes and tolls)$100.6 bil$99.9 bil$100.5 bil
Highway-User Revenues Used for Roads$81.0 bil$81.3 bil$79.6 bil
Total Transit Fares and Other System-Generated Revenue$9.8 bil $9.9 bil

Highways and Bridges

All levels of government generated $134.8 billion in 2002 to be used for highways and bridges. In addition to this total, $1.1 billion was drawn from reserves, so cash outlays for highways and bridges in 2000 totaled $135.9 billion. Highway expenditures increased 10.8 percent between 2000 and 2002, from $122.7 billion to $135.9 billion. Highway expenditures grew more quickly than inflation over this period, rising 7.5 percent in constant dollar terms (based on the FHWA Construction Bid Price Index for highway capital outlay and the Consumer Price Index [CPI] for all other types of highway expenditures). Since 2000, highway capital expenditures by all levels of government grew 11.2 percent to $68.2 billion in 2002. The Federal government contributed $31.2 billion (46.1 percent) of total highway capital expenditures.

In 2002, 52.6 percent of highway capital outlay was used for system preservation, up marginally from 52.0 percent in 2000. Highway user revenues (the total amount generated from motor-fuel taxes, motor-vehicle taxes and fees, and tolls imposed at the Federal, State, and local level) rose slightly, from $99.9 billion in 2000 to $100.5 billion in 2002. Of this total, $79.6 billion (79.2 percent) was used for highway programs.

Q. What accounts for the large revisions in the year 2000 highway expenditure data shown in Exhibit 6-1?

Much of the data reported in this chapter relies on Table HF-10 in Highway Statistics. The local data shown in this table are estimated, since local government financial data reporting lags a year behind that of State governments. These data are subsequently revised the following year, in Table HF-10A.

Typically these revisions are relatively small, and not significant in term of C&P report findings. However, in 2000 the initial estimate in Table HF-10 had predicted a local capital outlay figure of $16.7 billion, while the final Table HF-10A numbers issued the following year showed the actual figure was only $14.3 billion. State capital outlay was also revised downward by $0.9 billion. Based on these revised figures, the portion of total highway capital outlay funded by the Federal government in 2000 was 42.6 percent, which is significantly higher than the 39.9 percent figure based on the initial estimates.

Q. How was the $31.2 billion figure for Federal contributions to total highway capital expenditures derived, and why does this figure differ from amounts that appear in other documents (e.g., the President's Budget)?

The Federal expenditures shown in this report are intended to reflect the highway-related activities of all Federal agencies,rather than just those of the traditional transportation agencies such as FHWA. The figures shown in this report tie back to Tables HF 10 and HF-10A in Highway Statistics, which in turn are linked to Tables FA-5 and FA-5R, which list highway expenditures on an agency-by-agency basis at the Federal level. These data represent cash outlays, rather than obligations (which are more relevant in terms of the annual Federal budget) or authorizations (which are more relevant in terms of multiyear authorization bills). Since the financial data reported by State and local governments are compiled on a cash basis, this report uses the same basis for Federal expenditures to ensure consistency.

The Federal figures reported in Table FA-5 rely on data from a mix of Federal, State, and local sources. In some cases, this table captures Federal funding for highways that are not otherwise tracked at the Federal level. For example, under current law, 25 percent of the receipts derived from Federal timber sales are to be paid to States for public roads and schools in the counties where forests are situated. At the time these payments are made, it is unknown what portion will ultimately be used for roads as opposed to schools. However, once States have expended these funds, they are able to report to the FHWA what portion was used for roads, so that this information may be included in Table FA-5.

Note that the Federal highway funding figures in this report exclude any amounts funded from the Highway Account of the Federal Highway Trust Fund that were used for transit purposes as identified in Table HF-10. Such amounts would appear as Federal funding for transit in this report.

The $31.2 billion figure cited for the Federal contribution to total capital expenditures represents total Federal expenditures for highway purposes of $32.8 billion less direct Federal expenditures for noncapital purposes such as maintenance on Federally owned roads, administrative costs, and research.


In 2002, $36.5 billion was available from all sources to finance transit investment and operations. Transit funding comes from two major sources: public funds allocated by Federal, State, and local governments; and system-generated revenues earned for the provision of transit services. In 2002 Federal funding was $6.3 billion (17 percent of total transit funds), State and local funding was $26.6 billion (56 percent of total transit funds) and system-generated revenues were $9.9 billion (27 percent of total transit funds). Between 2000 and 2002 Federal funding increased by 15.4 percent, State and local funding increased by 22.0 percent and system-generated revenues by 0.6 percent.

Funding for capital investments by transit operators in the United States comes principally from public sources. Capital investments include the design and construction of new transit systems and extensions to current systems (also know as "New Starts"), and the modernization of existing fixed assets. In 2002, total public transit agency expenditures for capital investment were $12.3 billion in current dollars and accounted for 34.9 percent of total transit expenditures. Federals funds accounted for $5.0 billion of total transit agency capital expenditures ($4.2 billion in 2000), State funds for $1.4 billion ($1.0 billion in 2000), and local funds $5.9 billion ($3.8 billion in 2000).

In areas with populations over 200,000, Federal funds may not be spent on operating expenses. This limitation means that a higher proportion of Federal funds are spent on capital investments, while State, local, and system-generated funds are more likely to be spent on operating expenses. Nevertheless, as local governments significantly increased their funding for capital investments between 2000 and 2002, the Federal share of total capital expenditures fell from 47 percent in 2000 to 41 percent in 2002.

Transit operating expenditures include wages, salaries, fuel, spare parts, preventive maintenance, support services, and leases used in providing transit service. In 2002, $24.2 billion was available for operating expenses and accounted for 65.1 percent of total available funds. Of this amount, $1.3 billion was available from the Federal government, $6.1 billion from State governments, $6.9 billion from local governments, and $9.9 billion from system-generated revenues. In 2002, transit operators' actual operating expenditures were $22.9 billion compared with $20.0 billion in 2000, an increase of 14.5 percent. This was a larger percentage increase than experienced in any other 2-year period since 1993. Between 2000 and 2002, operating expenses for demand response systems and light rail increased more rapidly than operating expenses for other modes both in total and on a per passenger mile basis.

Page last modified on November 7, 2014
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