Sponsors
The bill increases fiscal discipline and annual predictability by aligning obligations to actual Highway Trust Fund receipts and directing unused authority to where it can be spent, but that discipline can reduce or delay federal support in low‑receipt years and shift costs and planning risks onto states, localities, transit agencies, riders, and taxpayers.
States, local governments, and transit agencies will have annual obligation limits tied to actual Highway Trust Fund receipts and a post‑August redistribution of unused authority, increasing predictability and the likelihood that available highway and transit funds are spent each year.
Taxpayers face lower risk of federal commitments that exceed available receipts because obligations are restrained to estimated/current Trust Fund receipts, reducing the likelihood of unfunded liabilities from the Mass Transit Account.
State governments and transportation researchers get multi‑year continuity because transportation research contract authority is made available for four fiscal years, enabling multi‑year research projects despite annual obligation limits.
State and local governments, transit agencies, and transportation workers could see reduced or prorated highway and transit funding in years when Trust Fund receipts are low, delaying projects, forcing service cuts, and disrupting jobs.
State governments may have less usable obligation authority because prior‑year unobligated balances and administrative/BTS set‑asides are excluded from distribution, effectively locking up funds that could otherwise support current projects.
Taxpayers and riders (especially in rural communities) may bear higher costs if reduced federal obligations shift expenses to state/local governments or force higher fares to maintain transit service.
Based on analysis of 4 sections of legislative text.
Caps annual federal obligations for highway and transit programs to Treasury's estimated net Highway Trust Fund and Mass Transit receipts and requires DOT to prorate and redistribute obligation authority.
Limits how much the federal government can obligate for surface transportation programs by tying annual obligation authority to Treasury estimates of net receipts for the Highway Trust Fund and the Mass Transit Account. It requires the Department of Transportation to prorate and distribute limited obligation authority across highway and transit programs and states, set special rules for research contract authority, and establishes timing and redistribution procedures for any undeliverable or unused amounts. Implements those caps beginning October 1, 2027, excludes certain administrative and Bureau of Transportation Statistics amounts from the cap, and prioritizes redistribution to States with large unobligated balances when additional obligation capacity becomes available.
Introduced February 5, 2026 by Mike Lee · Last progress February 5, 2026