Paying for Pet Projects at the Pump
The federal and state governments levy taxes on gasoline and diesel fuel primarily to fund highway construction and repair; however, states are often mandated to spend revenues on nonroad projects such as education and public safety. For example, in Texas only half of the state’s fuel taxes are used for highway construction and maintenance. Legislators claim their state must divert state highway funds due to budget shortfalls and insufficient general revenue. However, funds diverted to a popular cause, such as education, may displace rather than supplement other funding. The federal government should allow states to use federal funds for needed infrastructure repairs without mandating construction unrelated to roads.