The states successfully raising new transportation revenue
With the Highway Trust Fund still headed for insolvency due to declining vehicle miles traveled and more fuel-efficient vehicles, states are increasingly coming up with their own plans for raising additional transportation revenue — while hoping the federal government continues their historic role as a strong partner in their efforts.
The information on this page details the successful funding-focused plans to raise revenue at the state level for transportation since 2012.
Also, don’t miss our ongoing blog series taking a closer look at some of the plans in these states.
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Does raising taxes = political suicide?
Are voters more supportive of raising revenue than we think? Read our analysis of the elections that followed successful votes on state legislation to raise new transportation revenue.
The states that successfully raised revenue since 2012
Below these maps are the details on the successfully enacted legislative plans that raised revenues at the state level from 2012 to the present. Plans that merely move money around, authorize a general fund transfer, or increase bonding authority are generally not included here — this only charts new revenue for transportation, not spending. Note: states have varying schedules for their legislative sessions. *This list does not include states that passed bills enabling certain localities to raise their own revenues for transportation. For more info on these states that have passed “enabling legislation” see this short primer on enabling legislation that includes a map, from our Measuring Up package.
States listed alphabetically below
Arkansas (2012)
Enacted – Constitutional amendment passed by legislature (HJR 1001) in 2011; passed by voters in November 2012.
The state can issue $1.3 billion in new general obligation bonds, mostly for a 4-lane state highway network. A portion of these revenues will be given to city and county governments to repair rural and local roads. The voters approved an increase in the statewide sales tax (half a penny) to repay the bonding. Bonds must be repaid in 10 years at which time the sales tax is rescinded. Intended for roads, and specifically a four-lane state highway network.
California (2017)
SB 1 – Approved 4/7/2017
Increase in gasoline taxes and vehicles fees
SB 1 will raise $52 billion in new transportation revenue by raising the gasoline tax — unchanged in 23 years — by 12 cents (to 30 cents per gallon), increasing diesel taxes by 20 cents (to 36 cents per gallon) and creating a new annual fee on almost all vehicles based on value. It directs $7.5 billion to transit capital and operations, $1 billion into the state’s Active Transportation Fund and reserves $4 billion expressly for bridge repair. Read more details about what’s in the law in our blog post.
Delaware (2013)
Enacted — Increase in tolls
Tolls on State Route 1 were raised by $1 on weekends, which will generate $20 million annually. The new funds will avoid cuts for the Community Transportation Fund which pay for local transportation projects, and will help raise revenue for road maintenance. Intended for state highways, road maintenance.
Delaware (2015)
The bill will generate $23.9 million annually by increasing several vehicle and license fees, including a 0.5-percentage-point increase in the vehicle sales tax. DelDOT leadership has indicated the agency will focus these new funds on road repair and maintenance.
Florida (2014)
Enacted – HB 7175 was enacted in 2014
This broad transportation package includes new revenue from leasing right-of-way for cell phone towers near state roads and advertisements on state nature and recreational trails. It also calls for more toll roads. Intended for roads, and an increase of maintenance revenue. (Ch. 2014-223, L.O.F of HB 7175)
Georgia (2015)
- Increase fuel excise tax to 26 cents per gallon (29 cents per gallon for diesel)
- Index the excise fuel tax rates to both average vehicle fleet efficiency and the consumer price index (used until July 2018)
- Exempts fuel from current sales tax, except for the 1% that counties impose
- Imposes new registration fees for electric vehicles ($200/yr for noncommercial, $300/yr commercial)
- Heavy vehicles registered in Georgia pay a highway impact fee annually of $50 for vehicles between 15,500-26,000 lbs. and $100 for weights greater than 26,000 lbs.
- Institutes a $5-per-night fee for short-term lodging, made exclusively for transportation purposes in the state
- Gives the ability to counties and groups of counties to impose a limited duration transportation purpose local option sales tax of up to 1% by ballot.
HB 60 – policy largely incorporated into H.B. 170 above
Would amend the local option sales tax (T-SPLOST) law. It would allow any county to raise a local sales tax of up to 1% with approval of the county commission and voter referendum. Mayors or other local government leaders in the county would identify road, bridge, transit, rail, port and airport projects to be funded before the tax was put to approval by the county commission and voters. Counties would be allowed to bond against this revenue.
Under the existing law which this bill would amend, a local option sales tax referendum could only be held at a date set by the legislature and only across a region defined by the legislature. The timing and the size of the district were cited as factors in the notable defeat of the Atlanta region T-SPLOST in 2012.
HB 213 removes the previous restriction that limited MARTA (Atlanta’s regional transit system) to spending no more than 50% of its locally-raised revenue to fund operations. A previous version of this bill would have also allowed the cities and counties that support MARTA to increase the sales tax dedicated to the system by 0.5% (via ballot measures), but this provision was removed from the final bill.
Idaho (2015)
HB 312 will raise the state gas tax by 7 cents per gallon (to 32 cents per gallon) and increase annual registration fees to $21 for cars, $10 for motorcycles and $25 for commercial and farm vehicles. Hybrids and electric cars now face an additional fee of $75 and $140, respectively, which will be distributed into the highway account. The bill will also dedicate some excess dollars from the general fund to statewide roads projects. In total, the bill will increase revenues for transportation by $94 million per year.
Iowa (2015)
Would increase fuel taxes by 10 cents per gallon and increase vehicle permit fees to raise $215 million for roads and highways annually. It was passed through a bipartisan legislature and signed by Republican Governor Terry Branstad.
Indiana (2017)
Increases fuel taxes by 10 cents per gallon and indexes rates to inflation (but limits increase to one cent per gallon per year). Adds a $15 registration surcharge on large trucks. Adds a $150 annual fee on electric vehicles and $50 fee on hybrids. Dedicates revenue from sales tax on fuel to state highway accounts rather than the general fund. Repeals restriction on tolling and directs Indiana DOT to seek a waiver from USDOT to allow tolling on Interstate highways. The law will generate an estimate $854 million in new annual revenue for state and local road projects. More information can be found on the blog.
Kentucky (2015)
HB 299 will raise the floor on the assessed wholesale fuel price, setting the minimum tax to 24.6 cents per gallon. The current rate is 27.5 cents per gallon but the rate was expected to fall to 22 cents per gallon on the April 1 automatic adjustment date due to falling gas prices, so this act prevented a $292 million cut in revenue.
Maryland (2013)
Ch. 429 (HB 1515) enacted in 2013
This will raise $4.4 billion over six years, which includes borrowing ability against future revenues. It would:
- Index the gas tax to inflation starting immediately (with a ceiling of no more than 8% in any given year.)
- Add a 3% sales tax at the pump, phased in over a period of three years starting summer 2013.
- Requires indexing transit fares charged by the MTA to inflation via the consumer price index.
- The sales tax on gasoline will increase to 4% if the congressional ban on internet sales tax is lifted, otherwise, the tax goes up 5% if Congress does not lift the ban
- Modes aren’t defined, but it does fund the unified state transportation trust fund which funds ALL modes.
Read our detailed post on the details in Maryland’s plan.
Massachusetts (2013)
Chapter 46 of Acts of 2013 (H3535) enacted in 2013. (Proposal started with the Governor, legislature responded, governor vetoed, legislature overrode that veto)
- Raises the gas tax 3 cents and indexes it to inflation
- Requires MassDOT and MBTA to raise a greater portion of their costs—up to an additional $229 million per year—from tolls, fees, fares and other sources and from efficiencies
- Dedicates other state funds—including all proceeds from vehicle sales taxes—to transportation
- Increases taxes on cigarettes and tobacco products
Don’t miss our longer post on the proposals in Massachusetts.
Michigan (2015)
HB4614, HB4616, HB4370, HB4736, HB4737, HB 4738, SB414 — Enacted 11/10/15
- In 2017 gas taxes will increase 7.3-cents-per-gallon and diesel taxes will increase 12.3-cents-per-gallon to bring both 26.3-cents per gallon. Fuel tax rates will be indexed to future inflation. Fuel tax increases are estimated to bring in $400 million in new revenue.
- Another $200 million in new revenue will come from a 20% increase in vehicle registration and new fees on hybrid and electric vehicles, also beginning in 2017.
- Additionally, the package dedicates general fund money to the highway fund, beginning with $150 million in 2018 and ramping up to $600 million per year from 2020.
Montana (2017)
Increases gas tax 6 cents per gallon and diesel tax 2 cents per gallon by 2023 to raise $27 million in additional annual revenue. Thirty-five percent of new funding (or at least $9.8 million) is allocated to state highways and the remainder is allocated to local governments through a new construction and maintenance matching fund for local road, street and bridge projects.
Nebraska (2015)
Raises the per-gallon gasoline tax by 6 cents over four years to a total of 31.6 cents per gallon. The tax would generate an additional $25 million annually for the state and $51 million for cities and counties once fully implemented. Governor Ricketts vetoed the bill but his veto was overridden by the legislature.
New Hampshire (2013)
S.B. 367-FN-A enacted in 2013. Ch. 268 (HB 1142) enacted in 2014
- SB 367 increases the per gallon tax by 4 cents. The funds raised are dedicated to rehabilitation and bridge repair projects for the next two years. It also adds bonds for the widening of I-93.
- HB 1142 extends fuel taxes to fuels used by alternative fuel vehicles.
New Jersey (2016)
Increases fuel tax by 23 cents per gallon. The fuel tax hike will add $1.23 billion annually to the state’s transportation fund to pay for road and transit maintenance and construction projects. The bill also reduces the state’s general sales tax by three-eighths of a percent, eliminates the estate tax, increases earned income tax credits Gov. Christie and legislative leaders reached a funding agreements only after a months-long stalemate during which all but emergency transportation projects were halted due to lack of funds.
North Carolina (2015)
Reduces the gas tax in North Carolina from 37.5 cents to 34 cents per gallon by the end of 2016, but it amounts to a higher tax than what would have been calculated with the drop in fuel prices and no changes to its calculation. Beginning in January 2017, the gas tax is automatically adjusted based 75% on population increases and 25% on changes in the Consumer Price Index. The result is a $13.5 million reduction in transportation revenues in the short-term, but a $400 million gain from changes in the calculation in the gas tax.
Ohio (2013)
HB 59 enacted in 2013. Ohio Turnpike Authority will begin raising tolls Jan. 1, 2014
Biennial state transportation budget: A plan that would authorize the Ohio Turnpike Authority to issue $1.5 billion in new debt over 6 years to finance (roads-only) projects around the state. The debt would be repaid with increased turnpike tolls, and a large share of funds will be spent in Northern Ohio. (Though debts would be repaid with greater turnpike tolls, tolls for locals will be frozen for the next ten years. EZ pass transponder required.)
Oregon (2017)
Raises $5.3 billion over ten years for all types of transportation projects. The law increases the state fuel tax by 2 cents per year for a total increase of 10 cents per gallon. It adds a vehicle sales tax of 0.5 percent, increases vehicle registration fees and adds additional fees on high-MPG and electric vehicles. It also adds a $15 tax on adult bicycle purchases. The law introduces a new 0.1% employee payroll tax with revenues dedicated to transit. This tax is expected to generate $103 million annually. The bill passed the House 39-20 vote and passed the Senate 22-7.
Read more about the Oregon bill on the T4A blog.
Pennsylvania (2013)
Act 89 (HB 1060) enacted November 25, 2013
When fully implemented:
- Raises an additional $2.3 billion per year, including $1.65 billion for highways and $476 million for transit
- Establishes a first-of-its-kind, $144-million-per-year Multimodal Transportation Fund for local economic development
- Will allocate an additional $220 million to local governments (a 60% increase)
- Eliminates the per-gallon gas tax
- Increases the sales tax on gas assessed at the wholesale level (by gradually eliminating the cap on taxable value and replacing it with a floor)
- Increases vehicle registration, licensing and truck weight fees and moving violation fines
Rhode Island (2014)
H 7133 A enacted in 2014
H7133 directs revenues from vehicle fees and rental car taxes to the state highway maintenance fund, increases the gas tax by approximately one cent in 2015 and sets it to inflation for future years, and calls for a statewide referendum to approve issuing $35 million in bonds to fund multi-modal transit hub infrastructure. (This referendum is currently slated to appear on the ballot in November 2014.)
South Carolina (2017)
H. 3516 – Enacted 5/10/2017 (legislature overrode governor’s veto)
Increases fuel tax by 12 cents per gallon, phased in over the next six years. Increases registration fee by $16, add $60 biannual fee on hybrid vehicles and $120 biannual fee on electric vehicles. When fully implemented, the new taxes and fees will bring in approximately $730 million annually for road construction and maintenance projects across the state.
South Dakota (2015)
Increases motor fuels taxes by six cents-per-gallon (to 28 cents per gallon) to raise an extra $40.5 million annually; increases vehicle sales tax by one percentage point, for an extra $27-$30 million annually; increases vehicle registration and weight fees; expands abilities for counties and townships to levy local option property taxes for road and bridge repair and construction (with approval by voter referenda) and increases optional county vehicle registration fees; and creates a local bridge improvement competitive grant fund.
Tennessee (2017)
HB0534/SB1221 — Enacted 5/3/2017
Raises the gas tax by 6 cents per gallon to 27.4 cents per gallon and raises the diesel rate 10 cents to 28.4 cents per gallon, increases registration fees, and adds a new fee for owners of electric vehicles, bringing in $350 million per year for road projects. From the new revenue, $250 million will go to state highway projects and $100 million will be directed to cities and counties for local road projects. Cuts the sales tax rate on groceries from 5 to 4 percent, and cuts the franchise and excise tax on manufacturers. The law also allows the most populous cities and counties to increase local sales tax, business tax, car rental tax, hotel/motel tax, residential development tax or wheel tax, with approval through a voter referendum. A local government must approve a detailed transit improvement plan before levying a local transit tax.
Texas (2015)
SJR 5 — Enacted (approved by voters)
This amendment will set aside future state sales tax revenue to fund highways. Specifically $2.5 billion of the state sales tax revenue will be reserved for transportation, so long as overall sales tax receipts are at least $28 billion (approximately the collections this year). Additionally, 35% of revenue growth from taxes on vehicle sales and rentals will be set aside for transportation beginning in 2020, netting $250 million to $350 million annually. All revenues under this amendment would be dedicated to constructing non-toll highways (or servicing debt for such construction). The measure was approved by Texas voters.
Utah (2015)
HB 362 raises the tax on gas from 24.5 cents per gallon to a 12% assessed rate beginning January 1, 2016, with a floor on the gas tax rate 5 cents per gallon higher than today and able to increase up to an assessed tax of 40 cents per gallon. On diesel, natural gas, and hydrogen it incrementally increases the tax rate to 16.5 cents by July 1, 2018, (an increase of 8 cents per gallon for diesel and natural gas and a new 16.5 cents per gallon equivalent tax applied to hydrogen). A road-usage charge revenue system will be studied for potential future implementation in the state. The bill also enables counties to raise a quarter-cent local sales tax to fund local roads, transit, bicycle or pedestrian infrastructure or other transportation projects. This package will increase state transportation revenue by $76 million by FY2017.
Vermont (2013)
Act 12 [H.510] enacted in 2013
Governor’s budget bill raises $28 million annually by adding new 2% sales tax assessment to gasoline, reducing gas tax from 20 cents to 19.2 cents and issuing a $9 mil. bond to be repaid with existing revenues. Passed through a transportation budget bill, goes into effect on May 1, 2013. Diesel per gallon tax will rise three cents over two years, starting July 1.
Virginia (2013)
Ch. 766 (HB 2313) enacted in 2013
- Multimodal
- $3.5 billion over five years
- Sales taxes: Directs .175% of existing sales tax revenues to transportation; raises sales tax by .3% with 1.25% of the increase dedicated to transit and passenger rail. (Statewide sales tax increases from 5% to 5.3%)
- Local taxes: Imposes mandatory taxes in two regions: in Northern Virginia, increases sales tax by .7% and adds 15 cent per $100 assessed value to real estate transfer tax along with a 2% increase in hotel tax); in Hampton Roads it increases sales tax by .7% and adds a 2.1% wholesale tax on gasoline
- Gas tax: Eliminates the cents per gallon tax on gasoline and diesel; adds a 3.5% wholesale tax on gasoline and 6% on diesel (wholesale tax increases by 1.6% in 2015 if the Internet sales tax ban is not lifted)
- Vehicle fees: Adds a $64 fee on hybrid vehicles and raises the motor vehicle sales and use tax by 1.15%
- Other fees: Direct a portion of internet sales tax receipts to transportation if Congressional ban is lifted, which would raise $1.13 billion over five years
Washington (2015)
The package will raise $16.1 billion by increasing the fuel tax by 11.9 cents per gallon over two years and increasing vehicle weight and drivers license fees. The package directs $8.8 billion to new state and local highway construction projects, $1.4 billion to road repair, and $1 billion to transit, pedestrian, and bike projects.
It will allow Sound Transit to impose a vehicle tax of up to 0.8%, an additional 0.4% sales tax, and/or a property tax of 25 cents per thousand dollars by referendum; increase the cap on local option vehicle fees from $20 to $40 (if the local district has imposed a $20 fee for at least two years, up to $50 if the district imposed a $40 fee); allow transit benefit districts to impose a sales and use tax of up to 0.3% by referendum; and allow for the creation of passenger ferry funding districts.
You can read more about Sound Transit’s referendum on our blog.
West Virginia (2017)
Raises the floor on the variable-rate fuel tax by 3.5 cents per gallon (from 11.7 cents to 15.2 cents per gallon), increases the motor vehicle sales tax from 5 percent to 6 percent and increases various motor vehicle fees. The law will raise an additional $140 million annually for road projects.
Wyoming (2013)
Act 38 (HB 0069) enacted in 2013
Raise $70 million annually by increasing the gas tax ten cents per gallon. Intended for highways only.