Myth Busted: Road Costs Not Covered by Gas Taxes

Georgia PIRG

Atlanta – Today the Georgia Public Interest Research Group (Georgia PIRG) released a new report, Do Roads Pay for Themselves? Setting the Record Straight on Transportation Funding, that disproves the common misperception that road-building is paid for by user fees. The report shows that gas taxescover barely half the costs of building and maintaining roads, a fraction which is likely to fall steadily.

Among the findings of the report: 

• Federal gasoline taxes were originally intended for debt relief, not roads. 
• Highways, roads and streets have received more than $600 billion in subsidies over the last 63 years in excess of the amount raised through gasoline taxes.
• The amount of money a particular driver pays in gasoline taxes bears little relationship to his or her use of roads funded by gas taxes. Drivers pay gasoline taxes for the miles they drive on local streets and roads, even though those proceeds are typically used to pay for state and federal highways. 
• Most state gas taxes are partly offset by subsidies that exempt gasoline from sales taxes. 
• Federal gas taxes have rarely ever paid for solely for highways (correction from media advisory sent Thursday, Dec. 30)

“Georgia needs to make difficult choices about how to fund our states’ troubled transportation system. The first task is to discard common myths about how roads are paid for,” said Stephanie Ali, program associate with Georgia PIRG.

With gas in Atlanta reaching $3 in most places,  Georgia’s transportation future will be an important topic for the incoming General Assembly. 

This year, Congress will again address funding for the nation’s Highway Trust Fund, which has been bailed out four times with $35 billion from general funds since 2008. Federal gas taxes have not increased since 1993 and revenues are expected to remain flat as Americans continue to drive less and use more fuel-efficient cars.

“Highway advocates often wrongly portray highway spending as financially conservative by falsely portraying gas taxes as “user fees” that pay for roads,” said Ali. “Funding programs based on myths perpetuates waste isn’t based on what is most needed.”