Donor states and donee states: Investigating geographic redistribution of the US federal-aid highway program 1974-2008

Proceeds from federal motor vehicle taxes are deposited into the Highway Trust Fund, and expenditures from this fund are distributed to states to build and maintain transportation infrastructure. A conflict has arisen between donor states and donee states. Residents of donor states pay more in highway user taxes than the state receives in federal highway aid, while residents of donee states pay less in highway user taxes than the state receives in highway aid. This paper investigates the reasons that some states are donors and others are donees by simultaneously testing four hypotheses about the geographic redistribution of federal highway dollars. These hypotheses relate to a state's highway need, economic condition, level of urbanization, and representation on the key Congressional oversight committees. The findings indicate that states that are less urban and better represented on the four key Congressional committees generally benefit from redistribution. Redistribution does not favor states with indicators of need, such as larger highway systems, more highway use, or lower median incomes. These findings cast doubt on the need for the continued existence of geographic redistribution of Highway Trust Fund distributions.


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  • Accession Number: 01480134
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Feb 4 2013 3:30PM