Transportation Funding Bills

Fixing America’s Surface Transportation (FAST) Act

On December 4, 2015, former President Obama signed a bill authorizing federal transportation programs and funding through fiscal year 2020. The Fixing America’s Surface Transportation (FAST) Act authorized $305 billion in investments for the nation’s roads, bridges, transit, and rail systems. It also provided a slight increase in funding for all transportation modes. A one-year extension of the FAST Act through September 30, 2021 was enacted as part of the Continuing Appropriations Act, 2021 and Other Extensions Act (P.L. 116-159).

The focus of the highway funding in the FAST Act continues to be on the core formula-based programs and the ban on project earmarks. Considerable focus was placed on freight planning in the Moving Ahead for Progress in the 21st Century (MAP-21) Act, and the FAST Act builds on this by authorizing two new programs to target investments to projects that contribute to the efficient movement of freight. The first program, the National Highway Freight Program is formula-based and provided $39 million to Michigan in FY 2020. The second program, The Nationally Significant Freight and Highway Projects Program will be awarded on a competitive basis by the U.S. Department of Transportation (USDOT) to large nationally significant highway, intermodal, and rail freight projects.

The FAST Act also builds on the performance-based approach to investment decision-making that was included in the previous authorization bill. The FAST Act dedicates funds to support collection and management of data used in measuring performance and the development or improvement of tools that will help agencies better link investments with outcomes. Performance measures for transit and highway programs have been cooperatively developed by federal, state and local transportation planning partners to incorporate performance-based metrics to the transportation planning decision-making process.

Eliminated in MAP-21, the FAST Act resurrects the competitive program that make grants to transit agencies and states for bus and bus facility projects. It also authorized approximately $440 million per year for programs that make grants for intercity passenger rail projects. 

In order to fund the highway and transit investment authorized in the FAST Act, an additional $70 billion was transferred in FY 2016 from the federal general fund into the Highway Trust Fund (HTF). This will bring the total amount of non-transportation revenue that has been deposited into the HTF since 2008 to nearly $145 billion. 

Prior to this most recent reauthorization, the FAST Act had broken the cycle of short-term extensions and funding uncertainty that has characterized federal programs since 2008. This funding and programmatic certainty was one of the law's most important aspects. 

Summary of Michigan’s Road Funding Package

On November 10, 2015, former Governor Snyder signed the $1.2 billion legislative transportation revenue package. This is the largest state investment in transportation in Michigan history. Below is a high-level summary of the main points:

  • Starting in January 2017, an additional $600 million annually has been raised and dedicated for transportation purposes.
  • Roughly one-third flows to MDOT; two-thirds to counties, cities and villages. After full phase in, local agencies see an estimated 60 percent increase in Act 51 revenue over their 2015 allocation.  
  • $400 million in additional fuel tax revenues (fuel taxes rise to 26.3 cents per gallon for both gas and diesel).  
  • $200 million from a 20 percent increase in vehicle registration fees.

Starting in 2019, $600 million in additional revenue was phased in from an income tax redirection. The transfers have been phased in over a period of three years: $264 million in 2019; $468 million in 2020; and the full $600 million in 2021. This money is divided between the State Trunkline Fund, county road commissions, and cities and villages.   

Excise tax on recreational marijuana is to be allocated to the Michigan Transportation Fund for distribution to the State Trunkline fund, county road commissions, and cities and villages. The projected revenue for the next three fiscal years is $19.3 million in 2021, $35.0 million in 2022, and $52.5 million in 2023.

Note: Current as of February 2021