Colorado Taxes and Fees Only Cover Half of What Colorado Spends on Roads

Colorado taxes and fees collected from drivers only cover half of what Colorado spends on roads and bridges. Image: Tax Foundation
Colorado taxes and fees collected from drivers only cover half of what Colorado spends on roads and bridges. Image: Tax Foundation

When politicians argue for bike taxes or call transit a bad investment because it doesn’t pay for itself, the implicit assumption is that these modes are somehow different than roads, which purportedly “pay for themselves.” They couldn’t be more wrong.

In Colorado, state and local taxes and fees collected from road users only cover half of what state and local governments spend on roads and bridges, according to new research from the Tax Foundation. The tax policy watchdog released this infographic earlier this month, ahead of a forthcoming update to its semi-regular reports on transportation spending. (Note: the calculations do not include federal gas taxes or spending, but the general pattern of big subsidies for roads holds at the national level.)

“We really do face a big mismatch between the revenue that we’re collecting for roads and transportation and the amounts we’re spending on them,” said Joseph Henchman, executive vice president of the Tax Foundation.

In Colorado, the General Assembly hasn’t raised the gas tax since 1993. When you factor in inflation, the state is receiving less from the gas tax now than it did 24 years ago, according to a report from the Southwestern Energy Efficiency Project. Meanwhile, construction costs have been rising. Registration fees and tolls don’t come close to closing the road spending deficit.

But the state keeps plowing ahead with expensive projects like widening I-70, which only add to all the maintenance liabilities.

That’s why Colorado Department of Transportation Director Shailen Bhatt has called for a higher gas tax. A large enough increase could actually lower the subsidy for roads, unlike State Senator Ray Scott’s short-lived plan to tax bikes.

But the state could also make ends meet by spending the money it has smartly. Urban areas like Denver don’t need more highway lanes, more traffic, and more pollution.

The Tax Foundation doesn’t take a position on how to fix the funding gap — it just wants to shatter a false narrative.

“People always talk about fare-box recovery and how low it is, and how it doesn’t pay for itself, and we just wanted to highlight that that’s not a problem exclusive to transit,” Henchman said.

  • TakeFive

    Who besides the Streetsblog/Urban crowd fosters the myth that roads pay for themselves? That’s just silly from the get-go… unless perhaps you are talking about economic ROI.

    Different states utilize different methods of funding roads/bridges which can vary from the state level to local. Who cares; what does it matter? Those who use and/or depend on roads/bridges pay for 100 percent of their cost ie taxpayers. With respect to Colorado what is most important is that CDOT has an embarrassingly low level of funding, especially when compared to other growing states.

    With respect to Denver metro/RTD transit costs, users pay a very small percentage of the costs. They pay maybe 10 percent of the ($6 billion+) capital costs and about 25 percent of the operating costs. At least RTC/Las Vegas has a fare recapture rate near 52 percent. https://lasvegassun.com/news/2017/jul/27/at-a-crossroads-rtc-launches-meetings-on-long-term/

  • JZ71

    Ultimately, the taxpayers pay for 100% of what government spends on anything – the only question is which “pot” each dollar comes out of . . .

    • Tattler

      Wrong. Some people drive a lot less than others, and they are subsidizing the ones who drive more.

      • JZ71

        I didn’t say that some taxpayers pay in more than they receive back in direct services, I said that any government’s budget is funded entirely by tax revenues (from ALL fees and taxes that they’re able to levy on as many taxpayers as possible)! Or, to put it more bluntly, there is no free money, just creative bookkeeping. And while you may (choose to) drive less, remember that RTD’s budget is funded 100% by the taxpayers, yet less than 5% use RTD on any given day, There are things that each of us don’t use, yet we pay for them, because taxes are, at their core, socialism!

  • BrianGrilchCoin

    I wonder how bond issuance plays into this. The metric could be mixing up states that are receiving a lot of federal funds and those which are using leverage to spend in excess of revenue.

  • Tattler

    LOL at commenters who have no grip on why this constitutes a massive subsidy for roads, and have no idea why that matters.

    • JZ71

      Yes, all roads (just like all public transit, public libraries, public schools, public social services and police and fire services) are subsidized (paid for) by the taxpayers. The only question is HOW the government will extract the money it “needs” from the taxpayers? Why it “matters” is a whole other discussion, one about priorities, but ALL taxes are socialism – we ALL pay so SOME of us can receive “needed” services, at a lower cost than paying for them directly. What’s important to you is likely different from what’s important to me. Guess what? We each get one vote. If you don’t like the current set-up / priorities / results, get involved – vote for the “right” people, push your representatives to do the “right” thing(s). Heck, run for office, yourself! Just pointing out that roads are heavily subsidized ain’t gonna change that dynamic – make viable arguments for non-road solutions!

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