Where MoDOT’s Funding Comes From

At more than $2 billion a year, MoDOT’s annual budget is one of the largest in state government.  But with more than 32,000 miles of roads and bridges to take care of, as well as other transportation modes to support, every penny is needed.

Where does the money come from?  The department’s funding is generated almost entirely from “highway user fees” – what motorists pay when they’re actually using the highways.  We don’t get general sales tax or income tax dollars like many other state agencies.

Here are the specifics:

1. Federal fuel taxes provide most of the money for our construction program.  Every gallon of gasoline includes a tax of 18.4 cents – it’s 24.4 cents a gallon for diesel fuel.  This money is sent to Washington and, through the federal transportation bill that’s reauthorized every few years, returns to Missouri and the other states.  More than $800 million a year comes to Missouri through these taxes.
2. The state fuel tax is our biggest source of state funding, providing more than $500 million a year.  The tax is 17 cents for every gallon of fuel sold in Missouri – one of the lowest tax rates in the nation. 
3. Most of our other state revenue comes from the sales tax you pay when you buy a vehicle, and the fees you pay for licensing and registering those vehicles.  Added up, these amount to about $500 million a year.
4. The state highway patrol receives some highway user fees as well for its enforcement work, and the department of revenue gets a cut for collecting and administering all these taxes and fees.  Also, cities and counties receive a share of these funds to pay for local road improvements.
5. We also get some state and federal funding to support the state’s other modes of transportation – passenger rail, ports, public transit and aviation.  This is the only portion of the budget that’s not primarily funded by highway user fees.  But this portion is very small – only about one percent of our overall budget.