Funding Mechanisms for State Road Maintenance

Abstract

The deferred maintenance practices for road infrastructure will result in increasing life-cycle costs and deteriorating economic productivity. Governments have addressed the issue by expanding revenue sources, but we don’t know much about the revenue allocation mechanisms. This research reviewed 50 states’ constitutions and statutes to find the similarities and differences in the institutional features of the funding mechanisms for road maintenance. As of 2020, it found that ten states had strict earmarking mechanisms for securing resources for road maintenance; four states had less strict earmarking mechanisms. Furthermore, this research found wide variations in the designs of 50 states’ transportation/highway trust funds and their uses. The research developed the eight propositions to examine the relationship between the funding mechanisms and state highway maintenance spending. Overall, this research contributes to the current literature and policymakers to enhance our understanding of the funding mechanisms of 50 states for road maintenance.

Keywords

earmarking funding maintenance road infrastructure tax policy

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