For decades, the U.S. financed highways with dedicated user fees—especially the federal gas tax. But the tax hasn’t been raised since 1993, fuel efficiency has surged, and EVs are expanding. The Highway Trust Fund has posted deficits every year for more than a
The gas pump used to do the accounting. Drive more, burn more fuel, pay more. That money flowed into the Highway Trust Fund and state road funds, funding highways, bridges, and major roads without forcing tradeoffs with schools, health care, or other services.
But the numbers at the pump no longer match the bills on the road. The federal gas tax—18.4 cents per gallon—hasn’t been raised since 1993. Over the same period. vehicles have become dramatically more fuel efficient. hybrids have become commonplace. and electric vehicles (EVs) are surging. The Highway Trust Fund. which was designed to be self-sustaining. has run a deficit every single year for more than a quarter century.
In fiscal year 2025 alone, the gap between what drivers paid in and what roads cost hit $30.6 billion.
That shortfall is now pulling in money from far beyond the highway system. Over the past 15-plus years, Congress has transferred roughly $275 billion from the general Treasury into the Highway Trust Fund. That means the inputs to road funding now include income taxes. sales taxes. and borrowed money added to the national debt.
The Congressional Budget Office projects the fund could run dry around 2028. After that, annual shortfalls could potentially exceed $40 billion soon after. The cumulative gap over the next decade could reach hundreds of billions of dollars.
This is where the public tension sharpens: not everyone who pays for roads is driving them. Roughly one-third of Americans don’t drive—seniors who’ve stopped. people with disabilities. low-income households who can’t afford a car. and people in transit-served cities. When governments fill road-funding gaps with property taxes and sales taxes. the costs land on renters. homeowners. and shoppers across the board. There’s no opt out.
At the same time, low user fees don’t just create a budget hole. They also distort travel behavior. When drivers don’t feel the true cost of road usage, it encourages more driving, more sprawl, and more infrastructure demand—creating a funding pressure cycle that feeds back into the same problem.
The relationship between these facts is hard to escape: a federal gas tax that hasn’t been raised since 1993 is funding a system that’s becoming less aligned with how people get around—so deficits persist, Treasury transfers grow, and the burden broadens from drivers to the wider tax base.
Fixing it doesn’t require demonizing cars or punishing the people who depend on them. The path forward suggested here is practical: index the gas tax to inflation so it doesn’t erode; implement mileage-based fees that capture revenue from EVs and hybrids; prioritize maintenance over new construction; and stop promising more infrastructure than the funding base can deliver.
The core idea is blunt: those who use the roads should pay for the roads. And the longer that shift is delayed, the more painful and expensive the correction becomes. The gas pump math stopped working many years ago. The remaining question is whether policymakers will update the formula before the fund’s projected deadline arrives.
Highway Trust Fund federal gas tax infrastructure finance road funding user fees mileage-based fees electric vehicles Congressional Budget Office fiscal year 2025 general Treasury transfers