Title: Federal Highway Policies | Downsizing the Federal Government
Headings: Federal Highway Policies
Federal Highway Policies
Privately Built Roads in the 19th Century
The Rise in Federal Intervention
Fuel Taxes and the User Pays Approach
Five Disadvantages of Federal Highway Aid
Public-Private Partnerships
New Directions for Infrastructure Policy
Conclusions

Content: Instead, revenues from federal fuel taxes flowed into the government's general fund. That changed with the 1956 highway law, which directed a federal gasoline tax of 3 cents per gallon into a new Highway Trust Fund (HTF) for constructing the interstate system. The idea was to make the users of the interstate system pay for it. However, the user pays approach in federal fuel taxes began to break down in the 1980s. The Surface Transportation Assistance Act of 1982 redirected some fuel taxes away from highways and toward urban transit. Today, 2.86 cents of the 18.4 cents per gallon federal gas tax is redirected to transit. 20 Ironically, in signing the 1982 bill, President Ronald Reagan said, "Our country's outstanding highway system was built on the user fee principle — that those who benefit from a use should share in its cost." 21
Another development that is undermining the user pays approach is that since 1998 the federal government has pumped tens of billions of dollars of general revenues into the HTF. HTF spending has soared above HTF fuel-tax revenues, and Congress has filled the gap with other revenues. The 2015 highway bill provided $70 billion of general revenues to the HTF over five years.