Senators from states that don’t think they get enough money under the existing highway formula have started to use the annual appropriations process to write their own formulas for additional funding.

Background: each year, over $40 billion in federal-aid highway funding is given to states (and the District of Columbia) via a formula. This formula has remained remarkably static for over twelve years, and has three components:

• Each state’s share of an amalgam of the state population, lane-miles, VMT, bridge cost-to-upgrade, clean air non-attainment population, and trucking and fuel tax payments that existed in calendar year 2007 – which, as adjusted for “equity bonus” political considerations, formed the fiscal year 2009 formula highway apportionments;
• Each state’s share of the over 5,700 earmarked highway projects written into the August 2005 SAFETEA-LU law; and
• Several subsequent adjustments based on how much gasoline and diesel fuel gets purchased in Texas each year.

That’s it. That’s the “formula.” Nothing that has happened in the real world since 2007 matters except for how much motor fuel Texans buy. (The Senate’s bipartisan highway reauthorization bill, S. 2302, would extend that formula, with its 2005 earmarks and 2007 real-world factors, through 2025.)

Last year, the Eno Center produced a detailed report, Refreshing the Status Quo: Federal Highway Programs and Funding Distribution, which examined the history of highway formula funding distribution and laid out several alternate scenarios for possible future distribution of federal highway funds.

The House and Senate Appropriations Committees took matters into their own hands in fiscal 2020 and added funding to the fiscal 2020 Transportation Appropriations Act from general revenues “on top” of the regular highway program (which is funded from the Highway Trust Fund). And they chose to distribute the bulk of the money via formulas they designed themselves, not through the standard formula explained above.

In addition to the highway funding provided by the FAST Act and limited by the obligation limitation in the appropriations act, the appropriators also provided $2.03 billion from general revenues for three different formula-based programs, as follows:

• $781.1 million in general-purpose formula funding, to be “apportioned to the States in the same ratio as the obligation limitation for fiscal year 2020 is distributed among the States in section 120(a)(5) of this Act;”
• $1.150 billion for a new bridge program, where “the Secretary shall reserve $6,000,000 for each State that does not meet the definition of a qualifying State: Provided further, That, after making the reservations under the preceding proviso, the Secretary shall distribute the remaining funds made available under this heading…to each qualifying State by the proportion that the percentage of total deck area of bridges classified as in poor condition in such qualifying State bears to the sum of the percentages of total deck area of bridges classified as in poor condition in all qualifying States: Provided further, That for the bridge replacement and rehabilitation program: (1) no qualifying State shall receive more than $50,000,000; (2) each State shall receive an amount not less than $6,000,000; and (3) after calculating the distribution of funds pursuant to the preceding proviso, any amount in excess of $50,000,000 shall be redistributed equally among each State that does not meet the definition of a qualifying State”
• $100 million for Appalachian Development Highway System (ADHS) states,  to be “apportioned to Appalachian States according to the percentages derived from the 2012 [ADHS] Cost-to-Complete Estimate, adopted in Appalachian Regional Commission Resolution Number 736, and confirmed as each Appalachian State’s relative share of the estimated remaining need to complete the [ADHS], adjusted to exclude those corridors that such States have no current plans to complete, as reported in the 2013 [ADHS] Completion Report: Provided further, That the Secretary shall adjust apportionments made under the preceding proviso so that no Appalachian State shall be apportioned an amount in excess of 30 percent of the amount made available for construction of the [ADHS] under this heading”

Take, for example, Rhode Island. By the existing formula, it gets just 0.56 percent of total highway funding. But Sen. Jack Reed (D-RI) is ranking minority member of the Senate Transportation-Housing Appropriations Subcommittee, and used that position to urge that a lot of the general fund supplement for highway formula funding be used to benefit states that had a really high percentage of their total bridge deck area in poor condition. The 2020 iteration of this new formula in the appropriations bill gave each state a minimum apportionment, and capped each state’s total take at $50 million (a ceiling which Rhode Island, Connecticut and West Virginia hit), and $50 million was 4.35 percent of that extra $1.15 billion in formula money.

And the Appalachian Development Highway System is funded on a “cost to complete” basis, just as construction of the Interstate System was – there are a certain length of specific roads on a designated map, and every few years, the estimated cost to build the roads on that map that are not yet completed is updated, and each year’s available funding is divided amongst states based on each state’s share of the remaining cost to complete the building of the roads on the map.

Alabama has the most cost-to-complete left, and as luck would have it, the current chairman of the Senate Appropriations Committee is Richard Shelby (R-AL), who may have had something to do with throwing the extra $100 million at Appalachian highways in the 2020 bill (even with an arbitrary 30 percent limit on Alabama’s total, they still did rather well).

The table at the bottom of this article shows how these new formula programs altered the total formula share for each state. If you want to find ways whereby your state might benefit from other formulas, feel free to download our spreadsheet from the aforementioned report that contains over 65 different potential formula factors (updated through 2017, not 2007) and shows how well every state places in each.

(There are slight differences between the base formula ob limit percentages and the GF base formula percentages because the base formula ob limit is net of safety and performance penalties, whereas the GF base formula percentages are not.)