Fix It First, Expand It Second, Reward It Third: A New Strategy for America’s Highways

The roads and bridges that make up our nation’s highway infrastructure are sorely in need of repair as a result of insufficient maintenance—a maintenance deficit that damages vehicles, increases travel times, and can lead to accidents that cause injuries and fatalities. This deficit is in part due to a prioritization of new projects over maintenance of existing infrastructure and contributes to a higher-cost, lower-return system of investment. This paper proposes a reorganization of our national highway infrastructure priorities to “Fix It First, Expand It Second, and Reward It Third.” First, all revenues from the existing federal gasoline tax would be dedicated to repair, maintain, rehabilitate, reconstruct, and improve existing roads and bridges on the National Highway System. Second, financing for states to construct new and expand existing roads would come from a newly created Federal Highway Bank, which would require benefit-cost analysis to demonstrate the efficacy of a new construction project. Third, new and expanded transportation infrastructure that meets or exceeds projected benefits would receive an interest rate subsidy from a Highway Performance Fund to be financed by net revenues from the Federal Highway Bank.