Congress Should Stop Raiding the Highway Trust Fund for Buses and Subways

Congress should stop treating the Highway Trust Fund like a slush fund. The fund was created to support roads and bridges, paid for largely by drivers through the gas tax. But new analysis from EPIC for America’s David Ditch shows that in fiscal year 2024, roughly $22.4 billion of Highway Trust Fund spending, or 30.1 percent of the total, was diverted away from the nation’s core highway system. Reform should be a top priority when Congress writes the next highway bill in 2026.

Drivers Are Paying for Washington’s Diversions

The Highway Trust Fund was built on a simple idea: drivers pay into the fund, and the fund helps maintain the roads and bridges drivers use. Congress has steadily weakened that link.

According to Ditch’s EPIC report, Highway Trust Fund diversions now include transit formula grants, transportation alternatives, ferry programs, carbon reduction programs, EV charging and fueling programs, metropolitan planning, and other spending that is either loosely connected to highways or not connected to them at all. Out of $74.6 billion in Highway Trust Fund obligations in fiscal year 2024, about $22.4 billion went to diversions outside the interstate highway system.

That means nearly one-third of the fund is no longer focused on its core purpose.

This is not how a trust fund is supposed to work. Drivers pay federal gas tax dollars with the expectation that those dollars will support roads, bridges, safety, and highway capacity. Instead, Congress has used the fund to finance a growing list of unrelated or lower-priority programs.

Transit Funding Is Out of Balance

Mass transit is the largest diversion from the Highway Trust Fund. EPIC notes that transit’s share of commuting has fallen sharply over time and only recovered to 3.7 percent in 2024, yet transit receives a much larger share of Highway Trust Fund spending.

That imbalance is hard to defend. Transit ridership remains far below historic levels, and most Americans do not rely on public transit for daily travel. The federal government should not force drivers across the country to subsidize transit systems at levels disconnected from actual use.

Transit can be important in dense urban areas, especially in places such as New York City. But federal highway policy should reflect national transportation realities. A funding formula that treats transit as a permanent claim on driver-paid trust fund dollars ignores how most Americans travel.

Congress should give states more flexibility and reduce mandated transit funding. Low-transit states should not be forced to spend scarce transportation dollars on programs that do not fit their needs.

Diversions Are Driving the Trust Fund Toward Bailouts

The Highway Trust Fund’s problems are often blamed on the federal gas tax, electric vehicles, or changes in driving patterns. Those issues deserve attention, but they do not excuse Washington’s spending problem.

EPIC reports that Congress has enacted $271 billion in general fund transfers since 2008 to keep the Highway Trust Fund afloat. The Congressional Budget Office has warned that under current spending levels, the fund will exhaust its remaining balance by fiscal year 2028 and require hundreds of billions of dollars in additional support over the next decade.

Congress should not respond to this problem by raising taxes to protect wasteful spending. A new vehicle miles traveled tax, higher gas tax rates, or other new revenue sources would only make the problem worse if Congress refuses to reform the spending side first.

Before lawmakers ask Americans to pay more, they should stop diverting existing transportation dollars away from highways.

The 2026 Highway Bill Should Refocus the Fund

The next highway bill gives Congress a clear opportunity to fix this problem. Lawmakers should start by restoring the Highway Trust Fund’s basic purpose.

That means reducing overall spending to a level closer to trust fund revenue, eliminating wasteful programs created in the 2021 infrastructure law, cutting back unrelated spending, and giving states more flexibility to use transportation dollars where they deliver the most value.

Congress should also revisit rigid funding carve-outs that lock money into programs regardless of need. A state with limited transit use should not be forced to prioritize transit spending over roads and bridges. A trust fund supported by drivers should not be used as a permanent funding source for unrelated local projects, ideological programs, or federal experiments.

The goal should be simple: highway dollars should fund highways.

CFE Takeaway

The Highway Trust Fund needs discipline, not another bailout. Congress has allowed diversions to consume roughly 30 percent of the fund, even as transit ridership remains weak and the fund faces mounting fiscal pressure.

Drivers should not be treated as a revenue source for Washington’s unrelated spending priorities. The 2026 highway bill should restore the trust fund’s core mission, reduce mandated transit funding, and stop using highway dollars for programs that have little to do with highways.

Reform is overdue. Congress should end the diversion and put the Highway Trust Fund back on the road.