Wisconsin will need to find an additional funding source for road repairs and transportation spending or the quality of the state’s road system will decline, according to a new report.
Gas tax collections, which fund transportation spending, have progressively declined while the cost of road repair has increased significantly, according to Wisconsin Policy Forum.
“Either the state will have to forego spending and sacrifice road quality over time, or it will have to tap one of a few available funding sources such as the gas tax, vehicle fees, general tax dollars, mileage fees or local taxes and fees” the report finds.
The gas tax stopped being increased along with inflation after a 2005 law change and since then the state has used $2.6 billion of general funds between fiscal 2012 and fiscal 2025 on road work including $749.7 million in the 2023-25 biennial state budget.
Wisconsin has spent $821 per person in state and local funds over the most recent three years with data on road work compared to a national average of $811.
“While little of the analysis or warnings about the condition of our transportation funding system are new, we are reaching an inflection point–fiscally, technologically and demographically–that makes the stakes of ignoring long-term reforms to fund our roads, bridges and highways even higher than ever,” Wisconsin Transportation Builders Association (WTBA) Executive Director Steve Baas said in a statement regarding the report.
The cost of construction has gone up 56.8% nationally and 26.6% in Wisconsin since 2020.
The report suggests that some options to fix the funding gap include increasing the state general fund transfers, increasing the gas tax and vehicle registration fees, switching to a mileage-based fee used in pilot programs in several states or begin collecting tolls.
“Our economy stands on manufacturing, agriculture and tourism – all are incredibly dependent on roads and transportation,” Baas said. “If we are going to grow the state’s economy, creating a sustainable sufficient funding model to support smart asset management is an imperative. “The cost of doing nothing is prohibitive for Wisconsin communities and the Wisconsin economy.”
Mileage-based pilots have occurred in Oregon, Utah and Virginia with other states considering them for the same reasons.
“These little-used programs show mileage-based fees are technologically feasible, but remain relatively untested nationally and seemingly unpopular with motorists,” the report said.
