Now that the Trump administration’s “Big Beautiful Bill” has passed, one of the things Congress is turning its attention to is highway funding.

With a fall 2026 deadline for a new multiyear surface transportation bill, lawmakers must wrestle with a Highway Trust Fund model that no longer works — and hasn't for some time, really.

The most recent highway program authorization was part of the 2021 Infrastructure Investment and Jobs Act, also known as the bipartisan infrastructure law. 

Few would argue that the traditional source of the Highway Trust Fund, fuel taxes, is overdue for an overhaul. What they do argue about is how to do that. 

The current administration and Congress haven’t been shy about disrupting the status quo. If there was ever a time for bold changes in how we fund our highways, this may be it.

The Trust Fund: Running on Fumes

The Highway Revenue Act of 1956 created the U.S. Highway Trust Fund to fund the U.S. Interstate Highway System. It’s funded primarily through fuel taxes at a flat rate per gallon. But gas and diesel taxes haven't been raised since 1993. Inflation has eroded 73% of their purchasing power, while vehicles have become more fuel-efficient and in some cases electric.

The result? The Congressional Budget Office projects the Trust Fund will fall $188 billion short by 2030.

To shore up the fund, Congress has made general fund transfers, such as the $550 billion for transportation infrastructure in the 2022 JOBS Act.

But those are temporary fixes.

The Mileage-Based Tax: A Well-Worn Idea Revisited

A Vehicle Miles Traveled (VMT) tax has long been floated as a sustainable alternative to fuel taxes. Recommended by the bipartisan National Surface Transportation Infrastructure Financing Commission back in 2009, it’s often framed as a logical next step, especially with the rise of electric and hybrid vehicles.

Currently there are bills in Congress that would address the electric vehicle question by imposing a one-time fee on new EV sales. But the Tax Foundation calls this approach “a crude patch.” 

It says the ideal fix is a VMT tax that would measure actual road use and then charge the vehicle owner for each mile driven. 

According to the Tax Foundation, such a system could be fine-tuned to account for axle count and vehicle weight, helping match tax revenue to actual wear and tear. 

The Information Technology & Innovation Foundation has suggested an axle-weight-adjusted VMT tax—ranging from 1 to 13 cents per mile for single-unit trucks, and 1 to 19 cents for combination vehicles.

Of course, the devil is always in the details, and axle- and weight-based user fees could end up targeting trucking in unfair ways.

Low-Tech Mileage Fees

Many VMT systems and proposals would depend on GPS-based mileage tracking, which could also enable congestion pricing. But experience in pilot states has shown slow adoption and high administrative costs. This is another area where trucking has been brought into the conversation, since trucking today heavily depends on GPS data for everything from routing to billing.

The Reason Foundation, a libertarian think tank, recently suggested moving to a mileage-based user fee (MBUF) transition that uses low-tech odometer readings.

It wouldn’t allow for congestion pricing, says the foundation, but it could be implemented in many states more quickly and less expensively. 

TCA’s Approach

Meanwhile, the Truckload Carriers Association is advocating what it also says is a simpler solution than VMT: a Gallons-Based User Fee to address both the Highway Trust Fund deficit and repeal the long-reviled Federal Excise Tax.

A relic from from World War 1, the FET adds 12% to the price of new trucks, discourages fleets from investing in safer, cleaner, more efficient equipment.

TCA's proposal: Repeal the FET, adjust federal fuel taxes for inflation, and impose an annual registration fee for electric and hybrid vehicles. Unlike a VMT, TCA says this wouldn’t require a new bureaucracy or tax collection systems. 

It's Time to Act

When Congress reconvenes in September, it will be a year out from the highway program reauthorization deadline. But history has shown that these things move slowly, and more than once we've seen Capitol Hill just postpone the hard work with a temporary extension. 

The next surface transportation bill can’t just continue to kick the can down the road. 

There’s no shortage of ideas on the table — some practical, some politically difficult, and some decades overdue. Congress needs to put highway funding on solid footing for the long haul.