Highway Formula Fairness Act

Key Points

• This bill changes how the federal government distributes highway funding to states, starting in fiscal year 2027. It replaces the current formula with one that ties each state's share more closely to how much gas tax money its drivers actually pay into the Highway Trust Fund.
• Every state would be guaranteed to receive back at least 95% of the gas taxes its highway users contributed to the Highway Trust Fund. This is designed to fix the imbalance where some states pay in far more than they get back in federal road money.
• The formula uses the most recent available tax data to calculate each state's share, rather than relying on older numbers. This means fast-growing states with more drivers would see their funding keep pace with actual road use.
• The bill covers a broad range of federal highway programs including highway performance, surface transportation, safety improvements, congestion relief, freight, carbon reduction, and disaster resilience. It was introduced with bipartisan support by Senators Cruz, Cornyn, Kelly, and Gallego.