Order Code RL32409
CRS Report for Congress
Received through the CRS Web
Highway Program
Equity Guarantee Issues
Updated June 10, 2005
Robert S. Kirk
Specialist in Transportation
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress

---

Highway Program Equity Guarantee Issues
Summary
Since 1982 Congress has included legislative provisions in every surface
transportation reauthorization act to remedy concerns about the “equity” of the
distribution of federal highway aid to the states. For many years some states have
complained that they received significantly less federal highway aid than they paid
in federal highway taxes to the highway trust fund. These states, referred to as donor
states, have pressed for legislative remedies that would assure them a higher share
of federal highway aid, in recent years 95%. Donee states, states that receive more
federal highway aid than they pay in federal highway taxes, have not opposed equity
provisions per se but have opposed any reduction in their existing shares. Providing
equity remedies that keep both donor and donee states reasonably content has been
accomplished by giving more money to all states but giving more to donor states to
bring their shares up to a designated per cent share, currently 90.5%. Providing
equity in this way is very expensive in dollar terms, the minimum guarantee under
TEA-21, in fact, became the largest highway program.
The current budgetary environment is more constrained than it was under the
last reauthorization cycle, making it unlikely that the 95% goal can be achieved under
the current equity framework. There are, however, a number of options that could
help. The options range in scope from changes that may be seen as fine tuning the
existing minimum guarantee (MG) system to options that would eliminate the TEA-
21 MG framework completely.
During the 109th Congress, the House- and Senate-passed surface transportation
bills have taken different approaches to the equity issue. Under the dual constraints
of limited highway trust fund resources and the Bush Administration threat to veto
any six-year reauthorization bill that exceeds $283.9 billion, supporters of a major
rate-of-return increase also backed away from their 95% rate-of-return goals. The
House-passed reauthorization bill, the Transportation Equity Act: a Legacy for Users
(H.R. 3) retained the TEA-21 minimum guarantee structure and rate-of-return
(90.5%). The Senate-passed reauthorization bill, the Safe, Accountable, Flexible,
and Efficient Transportation Equity Act (H.R. 3, as amended) would achieve a 92%
return in the last year of the authorization through an equity bonus mechanism.
In a broader sense the debate over equity remedies has implications for a
number of overarching issues. An equity guarantee that approaches 95% rate of
return could, in the minds of some, leave little room for addressing other or
additional transportation needs that are uniquely federal. Another issue is whether
the MG should be broadened, as some states have proposed, to include Federal
Transit Administration programs. This report will not be updated.

---

Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
The Transportation Equity Act: A Legacy for Users (TEA-LU)
(H.R. 3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
The Safe, Accountable, Flexible, and Efficient Transportation Equity
Act (SAFETEA) (H.R. 3, as amended) . . . . . . . . . . . . . . . . . . . . . 2
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Legislative History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Surface Transportation Assistance Act of 1982 (STAA) . . . . . . . . . . . . . . . . 6
Surface Transportation and Uniform Relocation Assistance Act of
1987 (STURAA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA) . . . . . . 6
Equity Adjustment Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
TEA-21 Equity Provision Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Minimum Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Minimum Guarantee Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
The Resolution of the TEA-21 Donor-Donee Debate . . . . . . . . . . . . . . 9
The Central Dilemma: Raising Shares, Holding Harmless, and Funding
Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Equity Guarantee Options in a Constrained Fiscal Environment . . . . . . . . . . . . 10
Ways to Modify the Existing MG Program . . . . . . . . . . . . . . . . . . . . . . . . . 11
Phase in increases in the Share Guarantee . . . . . . . . . . . . . . . . . . . . . . 11
Eliminate or Reduce the District of Columbia’s Role in Projecting
Total Highway Program Size . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Determine Program Size Based on Total Annual Payments to the
Highway Account of the HTF . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Eliminate the State Percentages (Base Share) Table . . . . . . . . . . . . . . 12
Restrict the Program Scope of the MG . . . . . . . . . . . . . . . . . . . . . . . . 12
Reduce the Target Minimum Percent Return Below the 95% Level . . 13
The Donor State “SHARE” Proposal for a 95% Guarantee . . . . . . . . . . . . 13
Devolve the Highway Program to the States . . . . . . . . . . . . . . . . . . . . . . . . 14
Integrate the Guaranteed Rate of Return Into All Federal-Aid
Highways Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Overarching Issues for Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
The Role of the Federal Government Vis-a-Vis the States . . . . . . . . . . . . . 16
Program Purpose and “Scope” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Good for the Gander: a Minimum Guarantee for Transit? . . . . . . . . . . . . . 18
Appendix I: How the TEA-21 Minimum Guarantee is Calculated . . . . . . . . . . . 20
Appendix II: FHWA’s FY2003 MG Calculation Tables . . . . . . . . . . . . . . . . . . . 24

---

List of Tables
Table 1: MG Calculation Step 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Table 2: MG Calculation Step 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Table 3: MG Calculation Step 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Table 4: MG Calculation Step 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Table 5: MG Calculation Step 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

---

Highway Program Equity Guarantee Issues
Introduction
Guaranteeing each state a percentage share return of federal highway funding
on its highway user’s payments to the highway account of the highway trust fund
(HTF) has been the major remedy designed to assuage persistent concerns about the
equity of distribution of federal highway funding (often referred to as the donor-
donee state issue).1 Somewhat differing forms of a Minimum Guarantee (MG)
program have been in place for over twenty years. Under the Transportation Equity
Act for the 21st Century (TEA-21) (P.L.105-178; P.L. 105-206) the MG provided for
a 90.5% guaranteed share return on each states user tax payments to the HTF.
During the on-going TEA-21 reauthorization debate a number of proposals for
increasing the MG percentage have emerged. At first glance, raising the MG would
simply appear to require an amendment changing the percentage specified in Section
105 of title 23 of the U.S.Code. A closer look shows that changing the MG has
impacts on the interaction of highway program formulas, the funding of discretionary
and formula programs, and the total budgetary resources needed to fund these
programs: in short, on the whole Federal-Aid Highway Program (FAHP).
Recent Developments
The Transportation Equity Act: A Legacy for Users (TEA-LU) (H.R.
3). Although TEA-LU (109th Congress), the House-passed surface transportation
reauthorization bill, keeps some of the basic TEA-21 MG framework (the 90.5%
rate-of-return, $1 million minimum payment, and the hold harmless table), it also
makes a number of important modifications to the MG program structure and
calculations. The bill places five new formula programs within the “scope” of the
basic MG calculation: Coordinated Border Infrastructure, Highway Safety
Improvement, High Risk Rural Road Safety, Freight Intermodal Connectors, and Safe
Roads to Schools. It also eliminates the line-item authorizations for many of the
allocated (i.e. discretionary) programs, funding them instead as set-asides from the
National Highway System (NHS), Surface Transportation Program (STP), and
Interstate Maintenance (IM) programs. This change helps broaden the “scope” (i.e.
the programs under the auspices of the MG) of the MG program. The bill includes
1 This report focuses on the minimum guarantee remedy. For a more detailed discussion of
donor-donee issues see CRS Report RL31735, Federal-Aid Highway Program: “Donor-
Donee” State Issues, by Robert S. Kirk. Unless otherwise indicated in the text, any
occurrence of the HTF refers to the highway account of the HTF. The CRS tracking
document for surface transportation reauthorization in the 109th Congress is CRS Issue Brief
IB10138, Surface Transportation: Reauthorization of TEA-21, coordinated by John W.
Fischer.

---

CRS-2
just over $11.1 billion in High Priority Program (HPP) earmarks within the scope of
the MG. This provision caused concerns that the impact of HPP earmarks on the
states’ relative shares could lead to some states losing funding. In response to these
concerns the bill provides for a second funding overlay, the “equity adjustment,” to
assure that no state loses funding because of the HPP earmarks.2 H.R. 3 includes a
scope guarantee of 92.6% of the bill’s total contract authority. To achieve the 92.6%
scope, the bill includes a second new funding overlay, the “scope adjustment.” The
scope adjustment shifts National Corridor Infrastructure Improvement Program funds
to STP and recalculates the MG until the scope is 92.6%. Once this is done, funds
are restored to the corridor program (which then remains outside the scope).
The MG program is funded on a “such sums as necessary” basis and the new
equity and scope adjustments add to the cost of the overall bill. According to an
FHWA analysis of H.R. 3 as passed, over the life of the bill, the basic minimum
guarantee adjustment will cost $44.4 billion, the equity adjustment will cost $9
billion, and the scope adjustment will cost $2.3 billion.3
The House bill also includes a “re-opener” provision that would cut off funding
of all non-safety apportioned programs on August 1, 2006, if Congress has failed by
then to enact legislation that would increase states’ rate of return to 92% for FY2006,
93% for FY2007, 94% for FY2008, and 95% for FY2009.
The Safe, Accountable, Flexible, and Efficient Transportation Equity
Act (SAFETEA) (H.R. 3, as amended). In the 109th Congress, the Senate-passed
bill included most of the attributes of the Equity Bonus program that was in the
reauthorization bill the Senate passed during the last Congress. Because of the less
generous overall funding assumptions, however, the Senate-passed bill includes
modified language in the equity bonus program provisions. The goal of raising all
donor states’ rate of return to 95% by the final year of the reauthorization has been
scaled back to 92%. The scope of the equity bonus program would be roughly 92%
of total contract authority.
The Senate has taken a different approach from the House. The Senate-passed
bill would replace the entire MG program with an “Equity Bonus” program (EB).
Basically, the individual program formulas would determine the initial apportionment
and the equity bonus would be added to these levels. The Senate bill directs the
Secretary of Transportation to allocate to the states for each of the fiscal years 2005
through 2009 sufficient funds to ensure that each state receives at least a 92% return
(to EB specified programs and subject to certain rules and limitations described
below) on its estimated payments to the highway account of the HTF. The Senate
2 The House-passed bill retains the TEA21 “hold harmless” table set forth in 23 U.S.C.
105(b). However, because the table is not referenced in the “equity adjustment” provision,
how well donee states fare in obtaining HPP earmarks could have an impact on their states’
total apportionments.
3 House-passed H.R. 3 includes a provision that, in effect, eliminates the District of
Colombia’s share from the MG calculation. Under TEA21 DC’s share was the determining
factor projecting the total size of the highway program. By removing DC, the bill saves
money by lowering the total program size projection.

---

CRS-3
bill would keep nearly all the programs subject to MG under TEA-21 (IM, NHS,
STP, Congestion Mitigation and Air Quality Improvement Program (CMAQ),
Highway Bridge Replacement and Rehabilitation Program (HBRR), Recreational
Trails, Appalachian Development Highway System, and metropolitan planning)
subject to the equity provision.
The bill protects some states that would lose percent share under the EB’s 92%
share. States with a population density of less than 20 people per square mile, a
population under one million, a median household income under $35,000, or a
fatality rate on Interstate Highways in 2002 of greater than 1.0 per 100 million
vehicle miles traveled, would get either the 92% share or their average percent share
of apportionments under TEA-21.
The EB is also subject to certain rules and limitations which taken together can
be seen as placing a floor and a number of ceilings on the program. The special rules
provide that, all states are to be allocated enough funds to ensure that each state gets
at least 115% of its TEA-21 annual average, no negative adjustment may be made to
any state’s apportionment during the EB allocation, and requires that no state may
drop below 90.5% in FY2005, below 91% in FY2006-FY2008, or below 92% in
FY2009. EB allocations are not, however, to be given to states under certain
conditions. If a state’s total apportionments of all the designated EB programs
exceeds the state’s average TEA-21 apportionments by the following percentages the
state gets no bonus.
! FY2005 ceiling: 124% of state’s TEA-21 average
! FY2006 ceiling: 128% of state’s TEA-21 average
! FY2007 ceiling: 131% of state’s TEA-21 average
! FY2008 ceiling: 137% of state’s TEA-21 average
! FY2009 ceiling: 250% of state’s TEA-21 average
This is the main mechanism that phases in the 92% share goal by the final year
of the authorization. It also holds down the cost of the EB program.
Because, historically, the Environment and Public Works Committee (EPW)
has not disclosed its high priority project earmarks until conference, the state
apportionment and state rate-of-return data available during debate on the floor of the
Senate will not reflect the impact of the pending earmarks. The pattern of
earmarking within the scope of the equity bonus can change the states’ relative share
of apportionments and also the projection of total highway program size. According
to FHWA analysis, the five-year cost of the Senate-passed Equity Bonus Program
will be $25.4 billion.

This report begins with a discussion of the MG concept and the federal highway
program framework within which the MG is applied. It then sets forth the legislative
history of the MG since 1982, the year a minimum state share provision was first
enacted. The current MG (enacted in TEA-21) and how it is calculated is briefly
discussed. The report then discusses options for raising the MG share percentage in
a constrained fiscal environment. The report examines some of the overarching
policy implications of the MG debate. The report appendices provides detailed step-
by-step explanations of the calculation of the TEA-21 minimum guarantee.

---

CRS-4
Background
There are a number of characteristics of the Federal-Aid Highway Program that
need to be kept in mind in a discussion of the donor-donee question. First, the
Federal-Aid Highway Program (FAHP) is really an umbrella term for all the highway
programs administered by the Federal Highway Administration (FHWA). Most of
these programs can be described as being either formula (apportioned) programs,
which constitute the vast majority of program funding, or the smaller discretionary
(allocated) programs. The formula programs apportion funds to the State
Departments of Transportation based on formulas set forth in legislation. The
discretionary programs are programs nominally under the control of the FHWA that
were designed to provide funds to projects chosen through competition with other
projects. In recent years, however, most of the discretionary program funding has
been earmarked by Congress.
The distinction between formula and discretionary programs becomes especially
significant in the process of attempting to make equity adjustments in the funding
levels among the states. For example, how can all discretionary programs be
constructed to guarantee a designated percent return to states on their payments to the
HTF and still remain discretionary? The programs were created to fulfill perceived
policy needs. The separate program budget accounts were authorized based at least
in part on the amounts of money each program needs to meet its program goals
(determined in part by the budget constraints of the time) rather than by some other
measure such as basing the distribution on estimates of the revenue paid by highway
users in the individual states.
Some highway needs, such as roads on federal lands, border crossing
infrastructure, trade corridors, and interstate system maintenance, have inherently
federal aspects that would likely not be addressed if the Federal-Aid Highway
Programs were predicated on a return to all states approaching 100%. Even
advocates of “devolution” of much of the Federal-Aid Highway Program to the states
have acknowledged some federal needs.4 In addition, donor states themselves have
in the past recognized the need for some states to get an increased share of federal-aid
funds. During the ISTEA reauthorization debate, for example, donor states agreed
that large sparsely populated states and some small states (such as Rhode Island,
Vermont, and Delaware) should receive increased shares. Authorizors thought that
the sparsely populated “pass-though” states had insufficient state resources to build
and maintain their parts of the national highway network, so they were given
increased shares.
The size of the minimum guarantee/equity adjustment program umbrella (often
referred to as “scope”) has varied since the first equity program was introduced in
1982. The major formula programs were always under the MG umbrella but which
other programs were included changed under the various surface transportation
authorization acts. How many of the total programs are covered by the MG program
umbrella is important for a number of reasons. First, under a guaranteed share MG,
4 During the 1990s “devolution” generally referred to the shifting of federal programmatic
responsibility and funding resources to the states.

---

CRS-5
the more program dollars left outside the MG program the more likely that at least
some donor states will not reach their minimum percentage return relative to the
entire Federal-aid highway program. Second, in general, the more inclusive the MG
umbrella the more costly the MG program.5 Third, earmarking of programs under
the MG umbrella usually provides no new dollars to the state receiving the earmarks.
These earmarks simply allow Members of Congress to set project priorities.
Earmarks of programs outside the MG umbrella actually provide more money to the
state getting the earmark.
A number of statistical issues have an impact on the MG. The use of non-
current data (i.e., revenue estimates from two years prior) may skew the state donor-
donee ratios and lead to conclusions about donor or donee status that are
questionable. Also state-by-state data on payments to the highway account of the
HTF are estimates based on extrapolations from state tax data and may not always
be completely accurate or up to date. The economic cycle can also have an impact
on revenues and the budgetary process that can lead to years when revenues and
spending levels differ significantly from each other: this can have an impact on rate
of return. The MG and other equity adjustment proposals attempt to achieve a
specified “share” return on two year old payments data. Distribution equity,
however, is almost always judged by Table FE-221 in the annual FHWA Highway
Statistics Report6, which compares estimated dollars paid and apportionments and
allocations received for the same fiscal year. This statistical disconnect means that
even an effective MG or EB program will face criticism when the same year dollar
for dollar return data are released. In addition, the impact of proposed revenue
changes on states’ relative shares of payments to the HTF are hard to gauge over the
life of the reauthorization. These changes could change some donor states to donee
states, or vice versa, over the next few years. It could also impact the calculation of
program size under the MG.
Legislative History
Although the equity debate, it can be argued, goes back at least as far as the
creation of the highway trust fund (supported by dedicated highway user taxes), it
was the initial publication of Table FE-221 in the 1972 edition of FHWA’s annual
Highway Statistics that provided the statistical underpinnings of a growing
movement to guarantee each state a “fair share” of federal highway dollars relative
to the revenue its highway users paid to the trust fund. The table showed that the
receipt of federal aid for each dollar paid to the trust fund varied greatly from state
to state. Alaska faired best and South Carolina fared worst at $8.34 and $0.52,
respectively. During the 1970s there was still significant construction on the
Interstate Highway System. This may, in the minds of some, have provided a
5 This assumes all other attributes of the MG are held constant. This is not always the case.
For example, tax changes (such as a change in the tax treatment of ethanol) can have an
impact on states’ relative shares which could impact the calculation of total program size
which is discussed later in this report.
6 [http://www.fhwa.dot.gov/policy/ohim/hs02/fe221b.htm]

---

CRS-6
reasonable justification for such disparities. By the early 1980s, however, the
Interstate Highway System was nearing completion.
Surface Transportation Assistance Act of 1982 (STAA)
STAA (P.L. 94-424) authorized a significant increase in funding for the Federal-
Aid Highway system for the years FY1983-FY1986 and included a provision
designed to mitigate the dissatisfaction of donor states by providing that each state
would receive a minimum allocation from the core FHWA programs. Specifically,
the bill ordered the FHWA to allocate among the states sufficient funds to assure that
each state’s total apportionments from the core highway and safety programs
(Interstate Highway Substitution, Primary, Secondary, Interstate, Urban, Bridge
Replacement and Rehabilitation, hazard elimination, and rail-highway crossings, and
section 203 of the Highway Safety Act of 1973) would not be less than 85% of the
percentage of estimated tax payments each state paid into the highway account of the
HTF. These “equity adjustment” allocations could be obligated to the core highway
programs.7
Surface Transportation and Uniform Relocation Assistance
Act of 1987 (STURAA)
STURAA (P.L. 100-17) authorized the Federal-Aid Highway Program for
FY1987-1991, retaining the 85% minimum allocation, but altered the basis of its
calculation. The act revised the calculation to include the allocated (sometimes
referred to as discretionary) programs, with the exception of the federal lands
highways programs and safety programs. For FY1987 and FY1988 emergency relief
funds and interstate construction discretionary funds were not included in the
calculation. The act made permanent the minimum allocation provision established
by STAA.
Intermodal Surface Transportation Efficiency Act of 1991
(ISTEA)
ISTEA (P.L. 102-240) reauthorized surface transportation programs, including
Federal-Aid Highway Programs, for FY1992-FY1997, making major changes in the
overall program structure, program formulas, as well as equity provisions.
Equity Adjustment Provisions. ISTEA included five provisions, with
separate funding, designed to assure a more equitable distribution of federal funds to
the states.
7 STAA also established the Mass Transit Account of the HTF but did not make it subject
to the minimum guarantee. Although, typically, donee states in the Northeast are more
transit dependent, some highway donor states get significant federal transit funding, while
some donee states, especially the large “pass-through” Western States get relatively little.
Proposals to also subject the Transit Program to a minimum guarantee have surfaced within
the context of surface transportation reauthorization. As will be discussed later, this could
have an impact on the decision of some highway donor states to support or oppose highway
program minimum guarantee changes.

---

CRS-7
The 90% Guarantees. The act raised the minimum allocation to 90% of
estimated state contributions to the highway account of the HTF (although narrowing
its calculation to the core formula programs, scenic byways, safety belt and
motorcycle safety grants). The act also included a new minimum payments guarantee
that assured that each state’s apportionments (for the core formula programs) for the
fiscal year and allocations (to the discretionary programs) from the previous year
would be at least 90% of its estimated state contributions (i.e., calculated from all
programs except special projects).
Donor State Bonus. For each fiscal year, donor states were identified by
comparing projected contributions to the HTF with the apportionments to be received
that year by each state. Under the donor state bonus, starting with the state with the
lowest return, each state was brought up to the level of the state with the next highest
level of return. This was repeated successively for each state until the ISTEA
authorized program amount was exhausted.
Hold Harmless. This provision set a specific percentage that each state was
to receive from the core formula highway programs plus Federal Lands Highway
Programs, minimum allocation, donor state bonus, and Interstate Reimbursement.
Each state received an addition to its regular apportionments to raise its total to the
set percentage.
Reimbursement for Interstate Segments. ISTEA authorized $2 billion
for FY1996 and FY1997 to reimburse some states for the costs to them of building
segments of the interstate system without federal assistance prior to or during the
early days of the Interstate Construction Program.
Despite these provisions significant gaps remained among states on their share
return on contributions to the HTF. As reauthorization of ISTEA approached,
dissatisfaction with the effectiveness of the equity provisions led to challenges to the
ISTEA program paradigm.
TEA-21 Equity Provision Changes
The equity changes that were part of the debate and were included in TEA-21
were more limited than many would have expected early in the reauthorization
debate. The main reason for this was the large increase (roughly 40%) in overall
funding levels. Still, there were equity provisions that were included in the hope that
they would further narrow the donor-donee divide.8 For detailed, step-by-step
descriptions of the calculation of the FY2003 MG, see Appendices I and II at the end
of this report.
Minimum Guarantee. The TEA-21 minimum guarantee had three
components:
Guaranteed Base Share. TEA-21 guarantees each state a percentage share
(set forth in tabular form in TEA-21 Section 1104 (a), codified in 23 U.S.C. 105(b))
8 P.L. 105-178, Sec. 1104. Also 23 U.S.C. Sec. 105.

---

CRS-8
of the total program, defined as all the apportioned programs: Interstate Maintenance
Program(IM), National Highway System Program (NHS), Surface Transportation
Program (STP), Highway Bridge Replacement and Rehabilitation Program
(HBRRP), Congestion Mitigation and Air Quality Program (CMAQ), Metropolitan
Planning, Recreational Trails Program, Appalachian Development Highway System
Program and Minimum Guarantee, as well as High Priority Projects.9
Minimum 90.5% Share on Contributions. Each state is guaranteed at
least 90.5% return (up just 0.5% over ISTEA) on its share of tax contributions to the
highway account of the HTF (based on the most recent year for which the data are
available — generally from two fiscal years before).10 Using Ohio as an example, of
the state’s total FY2001 highway account contributions, Ohio’s percentage share
contributions amounted to 3.7578%. Ohio is guaranteed 90.5% of its share of
estimated FY2001 contributions and is thus guaranteed a minimum share of 3.4008%
of the FY2003 apportionments (i.e., the core formula programs), plus High Priority
Projects and the Minimum Guarantee itself. If the above base share is less than a
90.5% return to a state then the share is adjusted upward until the 90.5% share is
reached. The money to raise shares to 90.5% is provided by “squeezing” down the
percentages (but not the total amounts) of those states that are above the minimum.
This process of raising donor state shares and squeezing down donee state shares is
repeated until the state share requirements are met and all the state shares total 100%.
Minimum State Payment. Each state is guaranteed that as part of the
minimum guarantee it will receive at least $1 million in Minimum Guarantee funds.
It is important to keep in mind that the TEA-21 Minimum Guarantee was a
compromise provision. It is constructed in such a way as to give money to all states
in the process of bringing the donor states up to the 90.5% minimum guarantee.11
Each state gets the $1 million minimum. Then, the lowest percent share of any state
or the District of Columbia (under TEA-21 it was always the District) is used to
extrapolate the total program funding (as defined under Minimum Guarantee) needed
for the District to retain its total program percentage (see Appendix I, step 7, for a
detailed explanation) To achieve that percentage for the District, a total FY2003
program size of $27.8 billion was needed. Ironically, the degree of the District’s
donor status has meant more money for all states (in absolute, not relative terms).
To provide money for this adjustment 23 U.S.C. 105 (d) authorizes “such sums as
may be necessary” to carry out the MG. The total Minimum Guarantee program
funding needed to achieve this total was over $6 billion.
9 For example, according to this provision of law, the base share of total national allocations
for these programs is 1.5581% for Arizona, 0.3956% for the District of Columbia, and
4.9887% for Pennsylvania. The base shares for all states are set forth in Appendix II, step
2, column 1, of this report.
10 Although this percentage increase was small, supporters of this level argued that under the
TEA-21 framework, as opposed to the ISTEA MGs, states would actually receive a return
much closer to the percentage goal on a dollar-in/dollar-out basis.
11 TEA-21 authorizes such sums as may be necessary for FY1998-FY2003 for MG.

---

CRS-9
Minimum Guarantee Distribution. Each year, the first $2.8 billion of
Minimum Guarantee funds are administered as Surface Transportation Program
funds, except that set-asides for Transportation Enhancements, Safety Construction,
and certain population-based sub-state allocations do not benefit from this
distribution. Any Minimum Guarantee funds above $2.8 billion are distributed to the
five core programs: Interstate Maintenance (IM); Highway Bridge Replacement and
Rehabilitation Program (HBRRP); National Highway System (NHS); Congestion
Mitigation and Air Quality Improvement (CMAQ), and again the STP. The
distributions to the states are based on the ratio of each core program’s
apportionment to the total apportionment of all five programs for each state.12
The Resolution of the TEA-21 Donor-Donee Debate. In the end, what
many observers had predicted would be a major battle over TEA-21’s equity
provisions was resolved relatively amicably.13 This occurred despite the donor states
only being able to achieve a 0.5% increase in the minimum guarantee percentage and
formula changes which some predicted would have little impact on donor state
returns on the tax revenues these states payed to the highway account of the HTF.
Some even argued that donor states would have been better off if TEA-21 had
retained the ISTEA formulas. In the case of TEA-21 what alleviated the concerns of
the STEP-21 (a coalition of donor states) and other donor state advocates was the
amount of money available during TEA-21’s lifetime. By shifting revenues
generated by the 4.3 cent deficit reduction gas tax to the HTF in 1997, Congress was
able to provide for large increases in highway funding for all states. The extra money
in turn made the donor-donee debate less urgent to the donor states.
The Central Dilemma: Raising Shares, Holding
Harmless, and Funding Programs
The tension between the goal of donor states for a 95% return and the hold
harmless goal of donee states has been heightened in the current surface
transportation reauthorization debate by the absence of an HTF revenue base
sufficient to easily fund both goals. In contrast to the current reauthorization
situation, under TEA-21, the existence of large and growing revenues allowed for a
more than 40% increase in the federal highway spending and an increase in the MG
percentage (from 90% to 90.5%). Recent Congressional Budget Office (CBO)
baseline spending and revenue forecasts for the highway account of the HTF (based
on current law adjusted for inflation) forecasts that the unexpended balance in the
HTF will decline from a roughly $10.8 billion beginning-of-year for FY2005 to $6.5
billion. The HTF is required to retain a balance sufficient to assure that unexpended
highway contract authority may not exceed the end of year balance plus the
anticipated revenues for the next two years, the so-called “Byrd Rule.”14 The CBO
winter 2005 highway account trust fund receipt projections for FY2005 through
12 23 U.S.C. 105 (c) (1).
13 See Once and Future ISTEA, by Geoff Earle, Governing Magazine, Feb. 1998. STEP-21
Coalition Claims Victory, National Journal: Congress Daily, Oct. 3, 1997.
14 U.S. Internal Revenue Code, Title I, Section 9503(d).

---

CRS-10
FY2009 of roughly $182.5 billion. This is substantially less than the highway
spending obligations of $196.6 billion under TEA-LU (H.R. 3) as passed or of
$205.4 billion obligations under SAFETEA as passed (SAFETEA’s revenue
provisions would raise the revenue total to $189.4 billion). Even coming this close
required both the House and Senate bills to lower their rate-of-return targets to 90.5%
and 92%, respectively. In addition, assuming revenues cannot be increased
significantly, because MG funds are authorized on a “such sums as may be
necessary” basis, the only ways to fund the MG programs growing needs as they rise
to a 95% guaranteed share are to either dip into the Treasury general fund or to push
down the total apportionments of all the formula programs to free up revenues for the
MG distribution.
The difficulty of providing for an increase in guaranteed share while holding
most donee states harmless in the absence of large amounts of new revenue, however,
has not stopped some advocates of changes in the MG program from pressing for
change.15
Equity Guarantee Options in a Constrained Fiscal
Environment
Despite the fiscal constraints that impede the donor state desire for a 95% return
on payments to the HTF, there are a number of options that by themselves or in
combination with others could mitigate some of the difficulties that authorizors face
in producing a surface transportation reauthorization bill with equity provisions
acceptable to both houses of Congress. The options range in scope from changes that
may be seen as fine tuning the existing MG system to options that would eliminate
the TEA-21 MG framework completely. Some of these options have already been
included in the major TEA-21 reauthorization bills being actively considered by
Congress, some have had a place in the debate but have not yet been selected for
inclusion in active legislation, and finally some have been left out of the debate thus
far. The following discussion does not include revenue proposals championed earlier
in the reauthorization debate and the major revenue raising proposals in SAFETEA
and H.R. 3971 are only discussed within the context of their impact on the possible
program options being discussed.16
Statistical analysis of the MG and MG proposals can be problematic. As
mentioned earlier, the process of calculating shares and projecting the federal
highway program size can lead to results that appear counterintuitive.17 In addition,
15 This report is not a legislative tracking document for minimum guarantee provisions in
surface transportation reauthorization legislation. See CRS Issue Brief IB10138, Surface
Transportation: Reauthorization of TEA-21, coordinated by John W. Fischer.
16 For a discussion of these provisions see the Highway and Transit Finance chapter in CRS
Report RL32226.
17 For instance, revenue increases from changes in the tax treatment of gasohol could, under
some circumstances, restructure state shares relative to each other in a way that reduces the
(continued...)

---

CRS-11
because most supporting statistics set forth by proponents or opponents of change in
the MG are based on analysis of previous years revenue and funding data, while
reauthorization legislation is for future years, the analysis is limited. Because of
uncertainty in future revenue and funding allocations, there is a significant degree of
uncertainty in the impact of changes in the MG. This is especially true prior to
release of the reauthorization conference report. Even then, the statistics of the state-
by-state tax contributions used in the first step of the MG calculation to the HTF
would not be known for the last four years of a six year authorization. Only the
Federal Highway Administration (FHWA) has the data bases and expertise to project
the impact of these options on equity guarantee calculations in detail and even
FHWA must base future projections on assumptions that may not come to pass.
Ways to Modify the Existing MG Program
Assuming that the TEA-21 MG framework survives, it could be modified. This
section examines possible modifications to the TEA-21 framework.
Phase in increases in the Share Guarantee. This is perhaps the simplest
money saving option. SAFETEA as passed, phases in the increase to 92% over the
life of the authorization. Although this tactic saves money, it has drawbacks. First,
it will not save enough by itself to lift the rate-of-return greatly. Second, some of the
large donor states will be unhappy with the phase-in proposal, believing equity
delayed is equity denied.
Eliminate or Reduce the District of Columbia’s Role in Projecting
Total Highway Program Size. As shown in the earlier description of the TEA-21
MG calculation, achieving DC’s adjusted share determined the total highway
program size.18 Some argue that a way of reducing the size of the MG distribution
needed to achieve a guaranteed share percentage would be to provide DC with a
generous dollar amount for its road needs but eliminate it or a portion of its funding
from the MG calculation. The House-passed TEA-LU (H.R. 3) included this
change.19
Determine Program Size Based on Total Annual Payments to the
Highway Account of the HTF. The uncertainties of projecting total program size
based on share has led to some discussion of eliminating this TEA-21 process (see
step 7 in the earlier section on the MG calculation) and simply using the total annual
payments to the highway account of the HTF to determine the program size for each
fiscal year. Proponents argue that this change would not only simplify the MG
calculation process but would also reduce the unexpected outcomes of tax or other
17 (...continued)
size of the projected total program target (i.e., a revenue increase could reduce the size of
the program).
18 For a detailed discussion of this process see the detailed explanations of step 7 of the
calculation set forth in Appendix I and Appendix II.
19 Although this saved money, TEA-LU’s “equity adjustment” absorbed the savings.

---

CRS-12
revenue changes.20 Having total annual payments to the highway account set the total
highway program size, according to supporters, would also more effectively align
state payments with their allocations.
There are a number of possible disadvantages to using total annual payments to
the HTF to determine the total program size. As mentioned earlier, the data on
contributions are not, generally available until early in the second fiscal year after the
contributions are made, so the program size would be set according to old data. Also,
this method would, in effect, set a ceiling on each year’s spending (i.e., there is no
need for the “such sums as may be necessary” for the MG). This could force a
reduction in core program authorizations to make room for the MG distributions
necessary to meet the requirements of the MG. Finally, revenues to the HTF can
decline (as they did in FY2001). This could put Congress in the uncomfortable
position of having to either draw monies from the general fund, draw down the
unexpended balance of the HTF (if there is anything left to draw down), or allow
spending to drop for the year.
Eliminate the State Percentages (Base Share) Table. The heart of
TEA-21’s hold harmless provisions is the State Percentages table codified in 23
U.S.C. 105 (b). One option which could save money would be to replace the
percentage table with a simple dollar amount base guarantee for each state. These
state amounts would be adjusted where necessary to bring states up to their dollar
amount base guarantee. The 95% guaranteed return would then be accomplished by
bringing up the apportionment of states whose base dollar guarantees are less than
95% of their estimated payments to the HTF. By guaranteeing a dollar figure rather
than a share percentage that cannot be reduced, this could require a smaller program
size to achieve the guaranteed return. Most donee states would probably resist giving
up their base share guarantees in exchange for a dollar amount guarantee unless the
dollar levels were generous. The savings could be significantly reduced depending
on how generous the dollar base levels would need to be to pass the bill.
Restrict the Program Scope of the MG. One way to reduce the cost of
the MG is to reduce the number of programs covered by the guarantee (assuming that
other attributes are held constant). The states’ percent share return on payments to
the HTF could be applied to as small a number of the federal-aid highway programs
as needed to stay within budget. Under TEA-21, the scope of the guarantee was in
the 93-94% range. In the 109th Congress, SAFETEA and TEA-LU, as passed have
a scope of roughly 92-93%.
To an extent, TEA-LU as introduced in the 108th Congress, took this approach.
The bill provided for a 95% guaranteed return on contributions to the HTF by the last
year of the authorization, but the MG only covered programs that together accounted
for about 80% of the bill’s total funding (i.e. making the MG 95% of 80%). TEA-
20 During early discussions of redirecting the 2.5 cent ethanol tax to the highway account
and compensating the account for the ethanol subsidy, FHWA confirmed that, to the surprise
of most observers, that because of the role of DC (which uses virtually no gasohol) in
determining total program size, the increase in revenues would actually lead to a drop in
total program size.

---

CRS-13
LU’s categorization of programs under or not under the MG umbrella was
controversial and is believed by some observers to create problems for the
functioning of the MG. Donor states in particular were concerned that having such
a large number of programs outside the MG would undermine the MG program’s
ability to actually achieve the 95% return-on-payments target. Donor states were also
concerned that they will have to successfully compete for earmarks in the allocated
(non-MG programs) to achieve this level. The large donor states, in particular, would
probably see this process as, in effect, taking away with one hand what has been
given with the other.

Reduce the Target Minimum Percent Return Below the 95% Level.
Some have begun making the case that, under the current fiscal constraints, a 95%
return is an unrealistic goal for this reauthorization cycle. During TEA-21
reauthorization there was also a major effort to increase the minimum return to 95%.
In the end, as discussed previously, only a 0.5% increase was enacted. The large
increase in HTF revenue that was available to assuage donor states in 1998 may be
what is needed to provide for an increased guaranteed return. Such revenues are not
expected to be available in the FY2004-FY2009 period. In the current fiscal
environment the TEA-21 MG cannot provide a 95% return. Unless the TEA-21 MG
framework is replaced or altered, the minimum rate of return guarantee can only be
maintained or modestly increased.
The Donor State “SHARE” Proposal for a 95% Guarantee
The Highway Funding Equity Act of 2003 (H.R. 2208, S. 1090) is a proposal
supported by States’ Highway Alliance for Real Equity (SHARE) that would replace
the existing MG with a 95% share guarantee.21 Both the House and Senate versions
include a basic minimum guarantee of a 95% share return on state payments to the
HTF. The House version of the bill also includes a 95% discretionary program
guarantee which covers nearly all remaining program spending. This means that
there are two MG program umbrellas that expand the “scope” of the MG to all
programs except Federal Lands Highways, research, and the administrative
takedown.
The bill includes some other significant attributes. It holds harmless states with
fewer than 50 people per square mile. These states are guaranteed their TEA-21 base
share from the table in 23 U.S.C.(b). The bill also requires that the Secretary of DOT
shall “allocate among the States amounts sufficient to ensure that the percentage for
each State of the total apportionment for the fiscal year equals or exceeds” the 95%
minimum or the sparsely populated state percentage mentioned above. In addition,
for the 95% share discretionary guarantee, in the House version, the Secretary is to
allocate among the states amounts sufficient to ensure that when all of the allocations
for the fiscal year have been identified each state’s percentage will equal or exceed
the percentage that is equal to 95% of the tax payments ratio (state estimated tax
21 This discussion is based on H.R. 2208. S. 1090 is similar except that it does not include
a discretionary 95% guarantee.

---

CRS-14
payments/all states’ estimated tax payments). The bill authorizes “such sums as are
necessary” to carry out the provision.22
The strength of the SHARE proposal for donor states is that it most fully
addresses their preeminent desire for a 95% rate of return that covers the broadest
scope of programs possible. For the unprotected donee states, its main weakness is
their loss of share. Some observers might also argue that under SHARE the
guaranteed rate of return is so high and all encompassing that it calls into question
the rational for having a federal program and strengthens the arguments for
“devolution” of the programs to the states.
Devolve the Highway Program to the States
One approach to the MG and donor-donee controversy that attracted attention
during the debate prior to passage of TEA-21, but that has not garnered much interest
in the current reauthorization debate, would be to simply devolve most of the federal
highway program role to the states.23 The Transportation Empowerment Act (H.R.
1470 and S. 1907, 105th Congress), sponsored by Senator Connie Mack of Florida
and Representative John Kasich of Ohio, would have devolved much of the federal
highway program role to the states.24 Only a program for maintaining the Interstate
System, federal lands highways, National Security Highways, Emergency Relief, and
a proposed Infrastructure Special Assistance Fund would have remained federal. A
four year phase out of 12 cents of the federal gas tax would have corresponded with
the declining federal role. States would have had the option of replacing the
declining federal taxes with gas tax increases of their own. States would then have
had the freedom to spend, or not spend, on their own roads as they saw fit.
Although this proposal garnered some support from advocates of a reduced
federal role in transportation, it did not obtain broad support from many governors,
state legislatures, or State Departments of Transportation, many of whom were wary
of the political implications of pushing large replacement gas tax increases through
22 Intuitively, because the bill does not hold all donee states’ shares harmless, one would
expect the SHARE proposal to be less costly than TEA-LU (as reported) or SAFETEA (as
passed), however this may or may not be the case. First, all other attributes held steady, the
broader the programmatic scope of the MG the more costly its implementation. The
SHARE proposal has a broader scope than either of the active legislative proposals. Second,
the bill appears to still require a projection of total program size similar to that in TEA-21.
This, combined with the ethanol tax revenue changes could, as with TEA-LU, lead to a
larger or smaller program size than expected. The place it clearly saves money, however,
in the unprotected donee state shares which are not held harmless. Although it appears that,
under SHARE, donee states’ dollar amounts would not drop below their TEA-21 levels,
their shares would.
23 As mentioned previously, “devolution,” during the 1990s, generally referred to the
shifting of federal programmatic responsibility and funding resources to the states.
24 Rep. Jeff Flake introduced a bill with similar attributes, H.R. 3113, the Transportation
Empowerment Act, on September 17, 2003. The bill was referred to the House
Subcommittee on Highways, Transit, and Pipelines on September 18, 2003. There has been
no further action on the bill.

---

CRS-15
their state legislatures, and at the same time keeping these funds dedicated to
transportation. Despite the failure of devolution proposals to be enacted, some would
make the case that the closer the MG gets to 100% the more sense devolution to the
states makes. They would argue that as the guaranteed rate of return increases the
FHWA’s simply becomes more like a tax collector for the states. The need for and
efficiency of the federal government as middleman comes into question. At this
time, however, there appears to be little interest at the state or federal level for any
radical change in the federal role in the highway program.
Integrate the Guaranteed Rate of Return Into All Federal-Aid
Highways Programs
If the assumption that the penultimate goal of federal-aid highway programs is
to guarantee each state, say a 95% share rate of return, then one way to accomplish
this would be to eliminate all other formula criteria and weight all the programs
within the scope of the MG to provide each state with the percentage share of the
program funds that would provide a 95% return on its share contributions to the HTF.
Congress would still authorize each program’s dollar amount and the old core
formula programs could still retain their program goals and requirements but the
apportionment of program funds to the states would be strictly determined by each
state’s percent share of contributions to the HTF. Funding for allocated
(discretionary) programs within the scope of MG could also be divided among the
states based on 95% share of their shares of contributions to the HTF. In such a
case, however, these funds would only be available for funding within each state’s
aggregate program allocations. The remaining 5% of revenues could be used to fund
program administration, the Federal Lands Highways Program, Emergency Relief,
and other small programs that do not lend themselves to a strict rate of return
distribution.
This approach has advantages and disadvantages. The main advantage is that
it would achieve the goal of a guaranteed percentage share return to the states without
requiring an expensive MG program. There would be no separate MG program
funding per se, since the rate of return minimum would be integrated into the
individual programs. It would also have the advantage of simplicity over the existing
MG program. Congress could set the size of the various programs without having
to consider the impact on the core programs of the MG distributions.
On the other hand, such an option could limit the ability of the federal
government to fund federal policy priorities. The program formulas that include such
demographic and infrastructure characteristic factors as lane miles, vehicle miles
traveled, diesel fuel used, cost to repair or replace deficient bridges, or weighted non-
attainment and maintenance area population, are, at least in part, an attempt to direct
federal funding where it is needed to fulfill the formulas’ program goals. Some
would also argue that basing federal funding distribution overwhelmingly on rate of
return on payments to the HTF will lead to inefficiencies where states, for example,
with relatively few deficient bridges could receive more bridge program funds than
states with relatively more or states with no air quality non-attainment areas could get
more CMAQ funding than some states with non-attainment areas. Perhaps the main
disadvantage of basing all programs on a guaranteed rate of return is that it would

---

CRS-16
doubtless be opposed by donee states who could not only see their shares reduced,
but would, in some cases, actually see a reduction in dollars received under the
federal programs.
Overarching Issues for Congress
Although much of the reauthorization debate has focused on the state by state
estimates of funding flows under the various bills and amendment proposals, there
are broad policy implications of the MG proposals, including the appropriate federal
role vis-a-vis the states, program purpose, and possible implications for mass transit.
The Role of the Federal Government Vis-a-Vis the States
The federal-state partnership in surface transportation has been a fundamental
element of federal highway policy since the passage of the Federal-Aid Road Act of
1916 (39 Stat. 355) although the nature and extent has changed over time.25 Under
the act funding was apportioned by formula to the state highway departments which
were responsible for the construction and maintenance of the federal aid highways.
The state and federal governments were seen as equal partners and this was, in part,
the rationale for the 50% federal match for highway construction projects. With the
passage of the Federal Highway and Revenue Acts of 1956 (70 Stat. 374 and 70 Stat
387), authorizations for the Interstate Highway System were greatly increased over
a 13 year authorization. It also established the federal match for Interstate
construction of 90%. The revenue title of the act established the HTF and raised the
gas and other transportation taxes to support it. These taxes were to revert back to
their original rates in FY1973, the estimated completion date for the interstate
system.26 However, although the obligations for the Interstate System as a percent
of total trust funded obligations began to decline after 1967, increasing obligations
for non-interstate highway programs more than made up for the difference. In
addition, with the encouragement of the states as well as construction and other
interest groups, the federal match for the major non-interstate programs was
increased to 70% in 1970, to 75% in 1978, and to 80% in 1992. Over time the
financial commitment has shifted away from the states and toward the federal
government.27
25 See Highway Assistance Programs: a Historical Perspective, by Porter K. Wheeler.
Washington, Congressional Budget Office. 1978. 86 p. See also archived CRS Report 91-
12 E, Matching Federal Aid for Highways: Rationale from Post Roads to Interstates, by J.F.
Hornbeck. 23 p.
26 The fuel taxes were 2 cents per gallon prior to passage of the Federal Highway Revenue
Act of 1956. The act raised the tax to 3 cents effective July 1, 1956. The tax was again
raised in 1959 to 4 cents effective October 1, 1959.
27 This is not to say that there is no cost to the states in participating in the Federal-Aid
highway program. Federal administrative, labor, and environmental requirements add
significant costs to federal highway projects in some states.

---

CRS-17
While the federal financial role was increasing, states were pressing for
increased flexibility to move their formula program apportionments among the other
formula programs or to transit, thereby, significantly increasing state control over
their spending choices under the Federal-Aid Highway programs (FAHP). The case
can be made that by the enactment of TEA-21, while the federal financial role had
increased significantly, through higher spending and increased federal share, the state
control over spending decisions was also increasing. In addition, the MG distribution
itself, which averaged roughly $6 billion per year during TEA-21, dilutes the impact
of the program apportionment formula factors which were originally designed, at
least in part, to help achieve federal program goals.
These trends, the enhanced federal financial role, increased state authority over
spending decisions, as well as calls during the current reauthorization debate for a
95% MG rate of return on a wide scope of FAHP programs, raises policy questions.
At what point does the federal role become so limited that converting the FAHP to
a revenue sharing or block grant programs makes sense? Federal administrative,
labor, and environmental requirements do add to most states’ project costs. On the
other hand, some would argue that despite state complaints concerning the costs of
complying with the federal highway program requirements and donor state
displeasure with their rates of return, the existing federal highway programs are still
seen by many as serving a national purpose and continue to be very popular with
most state departments of transportation.
Program Purpose and “Scope”
An issue which may be seen as being corollary to the federal role issue is
whether a high rate of return percentage, such as 95%, coupled with a similarly broad
program scope could constrain a federal programmatic response to federal needs as
they arise. Some federal programs, such as the Federal Lands Highways programs,
are accepted as being federal in nature and not lending themselves to equal
distribution across 50 states. For some programs there is less of a consensus.28
Having a 95% guaranteed rate of return and a similar percentage scope would
leave little room for targeted federal programs outside the MG. Given the
combination of the impact of the MG distribution on apportionments and program
flexibility that allows states to flex much of their core program funding among these
programs or to transit, the case can be made that programs that are directed toward
28 The issue of scope came up during the TEA-LU floor debate on the unsuccessful Isakson
amendment concerning the impact of including the proposed Projects of National and
Regional Significance program within the scope of the MG. Also referred to as “Mega,”
this program would fund very large projects costing over $500 million or the equivalent of
75% of a state’s annual total program apportionment to address transportation problem areas
that would lead to regional or national transportation improvements. The Amendment, by
including the Mega projects within the scope of the MG, would in effect have reduced the
MG apportionments of the state which received the Mega project funding. This would
reduce the attractiveness of such targeted federal programs to the states as well as diluting
the impact of the program. By leaving it out of the scope of the MG, the state or states
getting the grant would receive it as additional funding. See Congressional Record. V. 150,
April 2, 2004. P. H2070-H2080.

---

CRS-18
transportation infrastructure needs that are inherently federal in nature should be
outside the scope of the MG. Perhaps an option would be to redefine scope in a way
that only programs that serve what are clearly federal purposes could be outside the
scope of the MG. These programs could be designated in law as being inherently
federal. Any other programs whether formula or discretionary would be retained
within the scope of the MG. The MG debate would then be focused on a more
clearly defined concept of scope. Doing this would require a broad consensus among
both donor and donee state Members of Congress. Donor states advocates would
probably be concerned that programs defined as being federal in nature could add up
over time to the detriment of donor state rates of return. The issue is whether the need
for equity is greater than needs that are inherently federal.
Good for the Gander: a Minimum Guarantee for Transit?
Although the minimum guarantee/equity remedy debate during the current
surface transportation reauthorization debate in Congress has focused exclusively on
a guaranteed rate of return on payments to the highway account, some have argued
that a similar guarantee should be applied to payments to the mass transit account of
the HTF.29 The mass transit account is credited with the revenues from 2.86 cents
of federal fuel taxes. Roughly 80% of the Federal Transit Administration’s funding
comes from the mass transit account, the remaining funding is provided by treasury
general funds. The distribution of nearly all of these funds is by formula and by
earmark from the federal government to the individual transit authorities (i.e., it
differs from the highway programs which are funded through the state DOTs). From
a state perspective, the program set up tends to favor states that have large cities with
existing fixed guideway type transit systems (heavy rail, light rail, dedicated bus
lanes). Rural states and states with bus dependent transit tend to get less. The top
five states receiving federal transit funding (as of FY2002), California, New York,
New Jersey, Illinois, and Texas, received over 49% of total transit obligations. Some
transit donor states see their tax payments as subsidizing the urbanized states and
argue that they have transit needs themselves that are unmet. They also argue that
FTA programs unfairly underfund bus-only transit systems and that the need for
public transportation in rural areas is mostly ignored by the current funding
distribution.
Supporters of the FTA programs can make a number of arguments in defense
of the uneven geographic distribution of transit funding. The main argument is one
of program national purpose. Under the statement of policies, findings, and purposes
in 49 U.S.C. 1501, the focus is clearly on urban mass transportation with a goal to
“efficiently maximize mobility of individuals and goods in and through urbanized
29 For an example of state support of a 95% share guarantee for transit, see
[http://www.michigan.gov/documents/ReauthorizationBasicsWashington3_7_59563_7.ppt]
The State Highway Alliance for Real Equity (SHARE) has distanced itself from advocates
of a transit guarantee and has a policy statement on its website [http://www.sharestates.org]:
“The SHARE Coalition and its predecessors have been organized over the last twenty years
in an effort to improve their rate of return in the highway program funds. SHARE
specifically focuses on the highway program and has made a deliberate decision not to
address transit equity issues.”

---

CRS-19
areas and minimize transportation-related fuel consumption and air pollution.” For
transit systems to be efficient they need to serve areas of concentrated population.
A mass transit 95% guaranteed rate of return would shift large amounts of funding
to less densely populated areas where the number of people served would be low and
the costs per passenger mile would be high (i.e. would lead to inefficiencies). Some
would also argue that the support for a transit minimum guarantee is really based on
the assumption by states that they could flex a significant portion of their transit
funding to highway programs. Transit donee states may argue that a transit
guaranteed rate of return would punish the urban areas that have taken the initiative
to build, in some cases before significant federal funding was available, transit
systems that are in line with federal policy goals of enhancing urban mobility,
reducing fuel consumption, and improving air quality. Finally, transit interests argue
that the role of cities as economic centers means that urban mobility benefits not just
the cities but the nation as a whole.
The transit minimum guarantee debate has not garnered wide-spread public
support during the current reauthorization cycle but, especially should a 95%
guarantee for highway programs be enacted , it would not be surprising for some
form of transit equity provision to be at issue in the next reauthorization cycle. The
big losers would be California and New York. Interestingly, some states that are
highway program donor states are major beneficiaries of the transit program. For
example, should California and New Jersey support the 95% return on payments to
the highway account of the HTF, they could be in the position of having to oppose
a transit minimum guarantee or risk a loss of much more transit funding than they
gained through the highway program guarantee. In addition, such a major shift in
funding would probably require a major rewriting of the federal transit programs for
the programs to make sense as a whole. It would also overturn what many see as the
great compromise of 1982 under which the transit account of the HTF was created
and funded with 1 cent of the fuel tax increase in the bill. Transit dependent states
supported an expanded highway program in return.

---

CRS-20
Appendix I: How the TEA-21 Minimum Guarantee is
Calculated
The TEA-21 MG is calculated using a multi-step process. The program
guarantees that each state’s share of the sum of the apportionments of the programs
under the MG umbrella will be at least 90.5% of its share of payments to the highway
account of the HTF. This requirement, however, must be met while at the same time
fulfilling the two other parts of the guarantee, the guaranteed base share and the $1
million minimum state payment. TEA-21 required that the guaranteed return on
contributions to the HTF be based on data estimated for the most recent fiscal year
for which state-by state payment data are available. For the FY2003 MG calculation,
the most recent year for which data was available was FY2001.
The following discussion describes these steps and provides the step by step
results for three “states,” Arizona, the District of Columbia (DC), and Pennsylvania.
The full FHWA calculation tables for FY2003 are reproduced in Appendix II.30 An
understanding of the process and peculiarities of the calculation process are key to
understanding some of the MG policy options discussed in this report. Each step is
begun with a summary sentence or paragraph followed by a more detailed technical
description.
Step 1: Determine the minimum State Share of Apportionments Each State
Must Receive to meet the 90.5% guaranteed return on its payments to the HTF.
The estimated state payments for each state are divided by the contributions (i.e.
payments to the HTF) made by all states to produce each state’s percent share of total
contributions. These state shares of total contributions are then multiplied by 90.5%
to determine each state’s minimum percentage share of apportionments and high
priority project allocations it must receive.
Table 1: MG Calculation Step 1
FY2001 Highway
State Share of Total
90.5% of State
Account
Contributions
Share of
State
Contributions
Contributions
($000)
(1)
(2)
(3)
Arizona
505,219
1.8770%
1.6987%
Dist. of Columbia
30,960
0.1150%
0.1041%
Pennsylvania 1,084,084
4.0277%
3.6451%
Total for all states
26,915,773
100%
90.5%

30 This discussion is based on FY2003 MG calculation tables produced by FHWA. These
tables are used for instructional purposes by FHWA and are reproduced in Appendix II of
this report. No adjustment has been made for the 0.65% across-the-board rescission
imposed in P.L. 108-7.

---

CRS-21
Step 2: Compare base share from table in Sec. 1104 of TEA-21 to 90.5% of
state share calculated in step 1 to determine if adjustment is needed. If the TEA-
21 base share from the table in 23 U.S.C. 105(b) is lower than the share (calculated
in step 1) required to guarantee a 90.5% return, Table 2 identifies which states’
shares must be increased to assure each state’s return on their contributions.31
Table 2: MG Calculation Step 2
Base Shares
90.5% of State
Is Increase Needed
Specified in TEA-21
Share of Total
to Provide at Least
State
(Sec. 1104)
Contributions
a 90.5% Return
(1)
(2)
(3)
Arizona
1.5581%
1.6978%
Yes
Dist. of Columbia
0.3956%
0.1041
No
Pennsylvania 4.9887
3.6451
No
Total for all states
100%
90.5%
(9 of 50 states) Yes
Steps 3-5: raise adjustments to sec. 1104 base shares where necessary to
guarantee a 90.5% return and squeeze down other state base shares so total
equals 100%. For FY2003 a sequence of three adjustments were required to bring
all states base shares up to 90.5%, to squeeze down the other state shares, and to
obtain a 100% total for all state shares (for detail, see Appendix II steps 3 through 5).
Table 3 (Step 6) sets forth the revised state shares.
Step 6: check results of previous adjustment rounds and display final
return on highway account contributions for each state. This step verifies that
the repeated process of raising low shares up to 90.5% and the squeezing down of
other state shares is complete (column (1) showing the sec. 1104 base shares has been
added for comparison). As set forth in the Table 3, column 2, the “Revised Shares
for all States” are the shares that will be used to calculate the MG. Column 3 shows
the percent share necessary to guarantee 90.5%. Column 5 computes the final return
on HTF contributions by dividing the revised share from column 2 by the state share
of total contributions from step 1 column 2.
31 TEA-21 sec. 1104 also limited the initial base share adjustment to states that received a
90.5% return in 1998. This has been left out of this discussion for simplicity’s sake and
because later adjustments prevent these states from being penalized by the provision.

---

CRS-22
Table 3: MG Calculation Step 6
Original
Revised
90.5% of
Any States
Final
Sec. 1104
Share for
State Share
Revised
Return on
State
Base Share
All States
of
Shares
Highway
(used to
Contribut-
Below
Account
calculate
ions
90.5%
Contribut-
MG)
ions
(1)
(2)
(3)
(4)
(5)
Arizona
1.5581%
1.6987%
1.6987%
No
90.5%
Dist. Of
0.3956%
0.3860%
0.1041%
No
335.5%
Columbia
Pennsylvania
4.9887%
4.8671%
3.6451%
No
120.8%
Total for all
100%
100%
90.5%
States
As Table 3 shows, Arizona’s base share has increased to assure that its final
return on HTF contributions meets the 90.5% share minimum guarantee. At the
same time DC and Pennsylvania’s shares have been squeezed down but still maintain
a return of well over 100%.
Keep in mind that, at this point in the process, no dollar amounts have been
introduced since step 1. All the adjusting has been the adjusting of share
percentages, not dollars.
Step 7: Determine the Program Level. Step 7 may be the most confusing of
all the steps. In simple terms, because no money apportioned may be taken back, the
only way to meet all states guaranteed apportionment shares (determined in step 6)
is to increase the national total for all programs under the MG umbrella. The
required program size to meet each states percent share is projected and the largest
amount needed to meet any state’s share becomes the total program level.
In more detail, the MG, as mentioned earlier, requires that the states’ share of
apportionments of the total apportionments for the programs listed in Sec. 1104 (IM,
NHS, STP, HBRR, CMAQ, ADHS, Recreational Trails, Metropolitan Planning,
HPP, and the MG itself) will be the final revised share, set forth in step 6. It also
provides that no state shall receive less than $1 million annually. Step 7 begins, in
column 1 (see Table 4 below), with the state-by-state formula driven program
apportionment totals plus HPP funding. Each state is then given the $1 million
minimum amount (column 2). These total dollar amounts (column 3) may not be
taken away from any state. This means that the only way to achieve the percent share
set forth in column 4 is to set the national total based on the state that would need the
largest downward share adjustment.
Under TEA-21 this “state” has been DC. DC’s total program level in column
3, $107,154,552, is 0.4965% of the column’s national total of $21,592,143,690.
DC’s MG percent share is supposed to be 0.3860%. In other words, DC’s share must
be reduced from 0.4965% to 0.3860% without taking any money away from DC.
The only way to do this is to expand the total program to the level that will reduce
DC’s share to 0.3860%. FHWA calculates that for FY2003 the program needs to be
$27.763 billion.

---

CRS-23
Table 4: MG Calculation Step 7
Sum of All
Add
Total
Percent
Program Size
Apportion-
Minimum
Share
(including
State
ments (before
MG
(Add first
MG needed
MG) and High
Amount of
and second
to provide
Priority
$1 Million
columns)
state shares)
Projects
(Col. 3/Col. 4)
(1)
(2)
(3)
(4)
(5)
Arizona
316,379,875
1,000,000
317,379,875
1.6987%
18,683,489,297
Dist. Of
106,154,552
1,000,000
107,154,552
0.3860%
27,763,290,761
Columbia
Pennsylvania
1,171,973,757
1,000,000
1,172,973,757
4.8671%
24,100,025,780
Total for
21,541,143,690
51,000,000
21,592,143,690
100.000%
all States
Note: totals may not compute due to rounding.
Step 8: Calculate MG Apportionments to Reach National and State Program
Size Targets. Basically, this step uses the final percent share for each state
determined in step six to calculate each state’s dollar share of the $27.763 billion
national program. From these state dollar totals the sum of each state’s total
apportionments and HPP funds (column 1 in step 7) is subtracted. The result is the
MG apportionment for each state and for the MG program as a whole.
Table 5: MG Calculation Step 8
State
Percent Share
State Share of
Sum of all
Minimum
from Step 6
Target
previous
Guarantee
Program Size
Apportion-
Apportion-
ments and HPP
ment
Col 2 - Col 3
(1)
(2)
(3)
(4)
Arizona
1.6987%
471,620,135
316,379,875
155,240,260
District of
0.3860%
107,154,552
106,154,552
1,000,000
Columbia
Pennsylvania
4.8671%
1,351,268,739
1,171,973,757
179,294,982
Total
100.0000%
27,763,290,761
21,541,143,690
6,222,147,071
Note: MG apportionment totals do not reflect the 0.65% across the board reduction required by P.L. 108-7.
Further steps reduce the MG apportionment by 2% for state planning and research as well as determining the base
and “remainder” distribution amounts. Totals may not calculate due to rounding.
The complexity of the MG calculations is a result of FHWA’s successful
attempt to meet the requirements of the MG statute. The process reconciles two
requirements of the law that are, at face value, seemingly contradictory: that donor
states should get increased shares while donee state shares, for the most part, are to
be held harmless. Under TEA-21 these seemingly contradictory requirements were
resolved by the process of increasing the total program size. This worked under
TEA-21 because there was, as mentioned earlier, an increase in available gas tax
revenues supporting the HTF. This is not the situation in the current reauthorization
environment making it probable that the TEA-21 MG structure will need to be
significantly altered or replaced, if the guaranteed rate of return is to be increased.

---

CRS-24
Appendix II: FHWA’s FY2003 MG Calculation Tables
Step 1 - Determine share needed to provide guaranteed return on contributions.
FY2001
State
90.5 %
Highway
Share of
of State
State
Account
Total
Share of
Contributions
Contributions
Contributions
($000)
(col. (2) x 90.5%)
-1-
-2-
-3-
The MG provision guarantees that each State’s
Alabama
530,211
1.9699%
1.7828%
Interstate Maintenance, National Highway System,
Alaska
55,149
0.2049%
0.1854%
Surface Transportation Program, Highway Bridge
Arizona
505,219
1.8770%
1.6987%
Rehabilitation and Replacement, Congestion Mitigation
Arkansas
358,046
1.3302%
1.2039%
and Air Quality Improvement, Recreational Trails,
California
2,774,089
10.3066%
9.3274%
Appalachian Development Highway System, Metro
Colorado
381,643
1.4179%
1.2832%
Planning, and the Minimum Guarantee itself, along with
Connecticut
279,414
1.0381%
0.9395%
high priority projects (excluding #1818-1849)
Delaware
69,877
0.2596%
0.2350%
will be at least 90.5% of its share of Highway
Dist. of Col.
30,960
0.1150%
0.1041%
Account contributions (hereafter referred to as the
Florida
1,420,379
5.2771%
4.7758%
90.5% return). In this step we determine
Georgia
1,051,012
3.9048%
3.5339%
the minimum share of the apportionments (including
Hawaii
65,214
0.2423%
0.2193%
MG) and high priority projects that a State must receive
Idaho
150,304
0.5584%
0.5054%
to meet the guaranteed 90.5% return on its Highway
Illinois
954,519
3.5463%
3.2094%
Account contributions.
Indiana
678,256
2.5199%
2.2805%
Iowa
298,853
1.1103%
1.0048%
a. This computation is based on estimated contributions
Kansas
287,634
1.0686%
0.9671%
for the latest fiscal for which data are available. For the
Kentucky
516,121
1.9175%
1.7354%
FY2003 Minimum Guarantee calculations, FY2001
Louisiana
471,684
1.7524%
1.5860%
Highway Account contributions are used. The FY2001
Maine
145,885
0.5420%
0.4905%
contributions are shown in column (1).
Maryland
483,282
1.7955%
1.6250%
Massachusetts
506,099
1.8803%
1.7017%
b. In column (2) we determine what share of the total
Michigan
908,223
3.3743%
3.0538%
Highway Account contributions came from each State
Minnesota
403,413
1.4988%
1.3564%
by dividing each State’s contributions by the national
Mississippi
360,319
1.3387%
1.2115%
total.
Missouri
677,349
2.5166%
2.2775%
Montana
119,374
0.4435%
0.4014%
c. Since the guarantee promises only a 90.5% return
Nebraska
199,332
0.7406%
0.6702%
on each State’s share of Highway Account contributions,
Nevada
194,606
0.7230%
0.6543%
we multiply the share of contributions in column (2) by
New Hampshire
123,203
0.4577%
0.4143%
90.5%. The result is shown in column (3).
New Jersey
784,934
2.9163%
2.6392%
New Mexico
240,784
0.8946%
0.8096%
No State will receive less than the percentage
New York
1,085,665
4.0336%
3.6504%
shown in column (3) of the specified
North Carolina
832,487
3.0929%
2.7991%
apportionments (including MG) and high priority
North Dakota
84,669
0.3146%
0.2847%
project allocations.
Ohio
1,011,436
3.7578%
3.4008%
Oklahoma
451,040
1.6757%
1.5166%
Oregon
323,878
1.2033%
1.0890%
Pennsylvania
1,084,084
4.0277%
3.6451%
Rhode Island
72,226
0.2683%
0.2428%
South Carolina
489,539
1.8188%
1.6460%
South Dakota
86,785
0.3224%
0.2918%
Tennessee
658,017
2.4447%
2.2125%
Texas
2,328,273
8.6502%
7.8284%
Utah
223,770
0.8314%
0.7524%
Vermont
65,479
0.2433%
0.2202%
Virginia
746,594
2.7738%
2.5103%
Washington
513,692
1.9085%
1.7272%
West Virginia
187,696
0.6973%
0.6311%
Wisconsin
508,343
1.8886%
1.7092%
Wyoming
136,713
0.5079%
0.4597%
Total
26,915,773
100.0000%
90.5000%

---

CRS-25
Step 2 - Compare share provided in § 1104 to minimum share needed to guarantee 90.5% return and determine if initial adjustment is needed.
90.5 %
Is Increased
Is State
Base
of State
Share Needed
Eligible for
Shares
Share of
to Provide
Initial
State
Specified
Contributions
at Least
Adjustment?
in § 1104
(Step 1,
90.5% Return?
(1998 Return
col. (3))
(col. (1) < col. (2))
= 90.5%)
Section 1104 provides base State shares, but requires that they
-1-
-2-
-3-
-4-
be adjusted to ensure that
Alabama
2.0269%
1.7828%

each State receives the 90.5% return on its
Alaska
1.1915%
0.1854%

share of Highway Account contributions. In this
Arizona
1.5581%
1.6987%
Yes
Yes
step, we identify which need their starting shares
Arkansas
1.3214%
1.2039%

from §1104 increased to ensure their return on
California
9.1962%
9.3274%
Yes
Yes
their contributions.
Colorado
1.1673%
1.2832%
Yes

Connecticut
1.5186%
0.9395%

a. Column (1) shows the base State shares
Delaware
0.4424%
0.2350%
from
§1104,
Dist. of Col.
0.3956%
0.1041%

Florida
4.6176%
4.7758%
Yes
Yes
b. Column (2) shows the minimum share
Georgia
3.5104%
3.5339%
Yes
Yes
required for each State to meet the guarantee
Hawaii
0.5177%
0.2193%

of a 90.5% return. These are the result of
Idaho
0.7718%
0.5054%

Step 1 and are the percentages shown in
Illinois
3.3819%
3.2094%

column (3) on the previous page.
Indiana
2.3588%
2.2805%
Yes
Iowa
1.2020%
1.0048%

c. Column (3) identifies States that need an
Kansas
1.1717%
0.9671%

increase in the base share from §1104 to
Kentucky
1.7365%
1.7354%
Yes
receive the guaranteed 90.5% return.
Louisiana
1.5900%
1.5860%

A State needs an increase if its percentage
Maine
0.5263%
0.4905%

from §1104 column (1) is less than the share
Maryland
1.5087%
1.6250%
Yes
Yes
determined in Step 1 (shown in column (2)).
Massachusetts
1.8638%
1.7017%

Michigan
3.1535%
3.0538%
Yes
d. Under a provision in TEA-21 § 1104,
Minnesota
1.4993%
1.3564%

States are eligible for an initial increase
Mississippi
1.2186%
1.2115%

to their base share to provide the 90.5% return
Missouri
2.3615%
2.2775%

only if they received the minimum return
Montana
0.9929%
0.4014%

for FY1998. Column (4) shows the States
Nebraska
0.7768%
0.6702%
that
received a 90.5 percent return for FY1998.
Nevada
0.7248%
0.6543%

States not eligible in the initial round of adjust-
New Hampshire
0.5163%
0.4143%

ments are NOT penalized by this provision.
New Jersey
2.5816%
2.6392%
Yes

Watch the subsequent steps for Colorado
New Mexico
0.9884%
0.8096%

to see how this plays out.
New York
5.1628%
3.6504%

North Carolina
2.8298%
2.7991%
Yes
States with a “Yes” in both columns (3) and (4)
North Dakota
0.6553%
0.2847%

will have their base shares increased to ensure
Ohio
3.4257%
3.4008%
Yes
the guaranteed 90.5% return on their share
Oklahoma
1.5419%
1.5166%

of Highway Account contributions. Seven
Oregon
1.2183%
1.0890%

States will be adjusted.
Pennsylvania
4.9887%
3.6451%

Rhode Island
0.5958%
0.2428%

South Carolina
1.5910%
1.6460%
Yes
Yes
South Dakota
0.7149%
0.2918%

Tennessee
2.2646%
2.2125%
Yes
Texas
7.2131%
7.8284%
Yes
Yes
Utah
0.7831%
0.7524%

Vermont
0.4573%
0.2202%

Virginia
2.5627%
2.5103%
Yes
Washington
1.7875%
1.7272%

West Virginia
1.1319%
0.6311%

Wisconsin
1.9916%
1.7092%

Wyoming
0.6951%
0.4597%

Total
100.00%
90.5000%
9
14

---

CRS-26
Step 3 - Make initial adjustments, as needed, to base shares from §1104 to guarantee
90.5% return and adjust shares of other States so total remains 100%.
90.5 %
Initial Revised Shares
Base
of State
Raise share
Unadjusted
Reduced
Revised
State
Shares
Share of
to 90.5%
Base
Base Shares
Shares
in §1104 Contributions
Level
Shares for
on Other
for
(Step 1,
for Eligible
Remaining
States to
All States
col. (3))
States
States
Keep Total
(from cols. (3)
(from col. (2))
at 100%
& (5))
-1-
-2-
-3-
-4-
-5-
-6-
States whose base shares from §1104 do
not yield the 90.5% guaranteed return AND
Alabama
2.0269%
1.7828%
2.0269%
1.9914%
1.9914% which are eligible for the initial adjustment,
Alaska
1.1915%
0.1854%
1.1915%
1.1706%
1.1706% that is, States with a Yes in columns (3) and
Arizona
1.5581%
1.6987%
1.6987%

1.6987% (4) in Step 2, will receive the necessary
Arkansas
1.3214%
1.2039%
1.3214%
1.2983%
1.2983% increase to their base shares. The base
California
9.1962%
9.3274%
9.3274%

9.3274% shares of all remaining States will be
Colorado
1.1673%
1.2832%
1.1673%
1.1469%
1.1469% adjusted proportionately downward so that
Connecticut
1.5186%
0.9395%
1.5186%
1.4920%
1.4920% the total of the adjusted shares is 100%.
Delaware
0.4424%
0.2350% 0.4424%
0.4347%
0.4347%
Dist. of Col.
0.3956%
0.1041%
0.3956%
0.3887%
0.3887% a. Column (3) shows each State needing
Florida
4.6176%
4.7758%
4.7758%

4.7758% and eligible for an increase receiving the
Georgia
3.5104%
3.5339%
3.5339%

3.5339% minimum share necessary to guarantee the
Hawaii
0.5177%
0.2193%
0.5177%
0.5086%
0.5086% 90.5% return. These are the shares
Idaho
0.7718%
0.5054% 0.7718%
0.7583%
0.7583% developed in Step 1 and are shown in
Illinois
3.3819%
3.2094%
3.3819%
3.3227%
3.3227% column (2) for convenience. The sum of the
Indiana
2.3588%
2.2805%
2.3588%
2.3175%
2.3175% shares in column (3) is 30.4352%
Iowa
1.2020%
1.0048% 1.2020%
1.1809%
1.1809%
Kansas
1.1717%
0.9671%
1.1717%
1.1512%
1.1512% b. Column (4) shows the remainder of the
Kentucky
1.7365%
1.7354% 1.7365%
1.7061%
1.7061% States receiving the base shares from §1104.
Louisiana
1.5900%
1.5860%
1.5900%
1.5622%
1.5622% Just under the table is shown the sum of
Maine
0.5263%
0.4905%
0.5263%
0.5171%
0.5171% columns (3) and (4). As expected, the
Maryland
1.5087%
1.6250%
1.6250%

1.6250% percentages now add to more than 100%.
Massachusetts
1.8638%
1.7017% 1.8638%
1.8312%
1.8312%
Michigan
3.1535%
3.0538%
3.1535%
3.0983%
3.0983% c. Column (5) shows the shares for the
Minnesota
1.4993%
1.3564%
1.4993%
1.4730%
1.4730% remaining States after their base shares have
Mississippi
1.2186%
1.2115%
1.2186%
1.1973%
1.1973% been adjusted so the sum of the revised
Missouri
2.3615%
2.2775%
2.3615%
2.3201%
2.3201% shares is 100%. The shares have been
Montana
0.9929%
0.4014%
0.9929%
0.9755%
0.9755% proportionally reduced so that the sum of the
Nebraska
0.7768%
0.6702%
0.7768%
0.7632%
0.7632% shares for these States is reduced to
Nevada
0.7248%
0.6543%
0.7248%
0.7121%
0.7121% 69.5648% — the difference between 100%
New Hampshire
0.5163%
0.4143%
0.5163%
0.5073%
0.5073% and the amount reserved for the increases
New Jersey
2.5816%
2.6392%
2.5816%
2.5364%
2.5364% to the States shown in column (3).
New Mexico
0.9884%
0.8096%
0.9884%
0.9711%
0.9711%
New York
5.1628%
3.6504%
5.1628%
5.0724%
5.0724% d. Column (6) shows the revised shares for
North Carolina
2.8298%
2.7991%
2.8298%
2.7802%
2.7802% all States. The entries come from column (3)
North Dakota
0.6553%
0.2847%
0.6553%
0.6438%
0.6438% for the 7 States that received adjustments to
Ohio
3.4257%
3.4008%
3.4257%
3.3657%
3.3657% get the 90.5% return and from column (5) for
Oklahoma
1.5419%
1.5166%
1.5419%
1.5149%
1.5149% the remaining States.
Oregon
1.2183%
1.0890% 1.2183%
1.1970%
1.1970%
Pennsylvania
4.9887%
3.6451% 4.9887%
4.9013%
4.9013%
Rhode Island
0.5958%
0.2428%
0.5958%
0.5854%
0.5854%
South Carolina
1.5910%
1.6460%
1.6460%

1.6460%
South Dakota
0.7149%
0.2918%
0.7149%
0.7024%
0.7024%
Tennessee
2.2646%
2.2125% 2.2646%
2.2249%
2.2249%
Texas
7.2131%
7.8284%
7.8284%
7.8284%
Utah
0.7831%
0.7524% 0.7831%
0.7694%
0.7694%
Vermont
0.4573%
0.2202% 0.4573%
0.4493%
0.4493%
Virginia
2.5627%
2.5103% 2.5627%
2.5178%
2.5178%
Washington
1.7875%
1.7272% 1.7875%
1.7562%
1.7562%
West Virginia
1.1319%
0.6311%
1.1319%
1.1121%
1.1121%
Wisconsin
1.9916%
1.7092% 1.9916%
1.9567%
1.9567%
Wyoming
0.6951%
0.4597% 0.6951%
0.6829%
0.6829%
Total
100.00%
90.5000%
30.4352%
70.8049%
69.5648%
100.0000%
Sum of col.(3)
and col.
(4)==>
101.2401%

---

CRS-27
Step 4 - Check results of initial adjustment process (Step 3). If any States are receiving less than the 90.5% guarantee, increase their shares to the
90.5% return level and adjust shares of other States so total remains 100%.
Revised
90.5 %
Any
Second Round of Share Adjustments
Shares
of State
States
Unadjusted
Reduced
Revised
State
for
Share of
Below
Shares
Shares for
Shares
Shares
All States Contributions
90.5%
Raised
Remaining
on Other
Round 2
(Step 3,
(Step 1,
Level?
to 90.5%
States
States to
(col. (1)
col. (6))
col. (3))
<
Level
Keep Total (from cols.
col. (2))
at 100%
(4) & (6))
-1-
-2-
-3-
-4-
-5-
-6-
-7-
There are two reasons that a State
might be below the 90.5% return level
Alabama
1.9914%
1.7828%

1.9914%
1.9780%
1.9780%
after the initial adjustments. (1) Some
Alaska
1.1706%
0.1854%
1.1706%
1.1627%
1.1627%
States, Colorado for example,
Arizona
1.6987%
1.6987%
1.6987%

1.6987%
needed an adjustment from the
Arkansas
1.2983%
1.2039%
1.2983%
1.2895%
1.2895%
beginning of the process but were not
California
9.3274%
9.3274%
9.3274%

9.3274%
eligible for the initial adjustment
Colorado
1.1469%
1.2832%
Yes
1.2832%
1.2832%
because their 1998 return was
Connecticut
1.4920%
0.9395%

1.4920%
1.4820%
1.4820%
above 90.5%. (2) The downward
Delaware
0.4347%
0.2350%

0.4347%
0.4317%
0.4317%
adjustments made in Step 3 to bring the
Dist. of Col.
0.3887%
0.1041%

0.3887%
0.3861%
0.3861%
total shares back to 100% may have
Florida
4.7758%
4.7758%
4.7758%

4.7758%
reduced the share of a State whose
Georgia
3.5339%
3.5339%
3.5339%

3.5339%
initial base share from §1104 had been
Hawaii
0.5086%
0.2193%

0.5086%
0.5052%
0.5052%
high enough to an amount below the
Idaho
0.7583%
0.5054%

0.7583%
0.7532%
0.7532%
90.5% return level. Kentucky is an
Illinois
3.3227%
3.2094%
3.3227%
3.3003%
3.3003%
example of this situation.
Indiana
2.3175%
2.2805%

2.3175%
2.3019%
2.3019%
Iowa
1.1809%
1.0048%

1.1809%
1.1730%
1.1730%
a. Column (1) shows the initial revised
Kansas
1.1512%
0.9671%

1.1512%
1.1434%
1.1434%
shares from Step 3.
Kentucky
1.7061%
1.7354%
Yes
1.7354%
1.7354%
Louisiana
1.5622%
1.5860%
Yes
1.5860%

1.5860%
b. Column (2) shows the share
Maine
0.5171%
0.4905%

0.5171%
0.5136%
0.5136%
(determined in Step 1) necessary to
Maryland
1.6250%
1.6250%
1.6250%

1.6250%
provide the guaranteed 90.5% return.
Massachusetts
1.8312%
1.7017%

1.8312%
1.8188%
1.8188%
Michigan
3.0983%
3.0538%

3.0983%
3.0774%
3.0774%
c. Column (3) identifies the States
Minnesota
1.4730%
1.3564%
1.4730%
1.4631%
1.4631%
whose shares are below the minimum.
Mississippi
1.1973%
1.2115%
Yes
1.2115%
1.2115%
Kentucky’s, Louisiana’s, Mississippi’s,
Missouri
2.3201%
2.2775%

2.3201%
2.3045%
2.3045%
North Carolina’s, Ohio’s, and Oklahoma’s
Montana
0.9755%
0.4014%
0.9755%
0.9689%
0.9689%
returns at the beginning of the
Nebraska
0.7632%
0.6702%

0.7632%
0.7581%
0.7581%
adjustment process were above the
Nevada
0.7121%
0.6543%
0.7121%
0.7073%
0.7073%
minimum, but dropped below the
New Hampshire
0.5073%
0.4143%

0.5073%
0.5038%
0.5038%
minimum during the adjustment. The
New Jersey
2.5364%
2.6392%
Yes
2.6392%

2.6392%
other two States, Colorado and
New Mexico
0.9711%
0.8096%

0.9711%
0.9645%
0.9645%
New Jersey were already
New York
5.0724%
3.6504%

5.0724%
5.0382%
5.0382%
below the minimum at the beginning.
North Carolina
2.7802%
2.7991%
Yes
2.7991%

2.7991%
They were prevented from getting
North Dakota
0.6438%
0.2847%

0.6438%
0.6395%
0.6395%
adjustments in the initial round by the
Ohio
3.3657%
3.4008%
Yes
3.4008%

3.4008%
requirement that initial adjustments
Oklahoma
1.5149%
1.5166%
Yes
1.5166%

1.5166%
go only to States whose FY1998 returns
Oregon
1.1970%
1.0890%

1.1970%
1.1889%
1.1889%
were at the 90.5% minimum level.
Pennsylvania
4.9013%
3.6451%
4.9013%
4.8683%
4.8683%
Rhode Island
0.5854%
0.2428%

0.5854%
0.5814%
0.5814%
d. Column (4) shows the shares raised for
South Carolina
1.6460%
1.6460%
1.6460%

1.6460%
for the 8 States that were below the
South Dakota
0.7024%
0.2918%

0.7024%
0.6976%
0.6976%
minimum after the initial round of
Tennessee
2.2249%
2.2125%

2.2249%
2.2099%
2.2099%
adjustments. It also shows, in italics, the
Texas
7.8284%
7.8284%
7.8284%

7.8284%
shares for the States whose shares were
Utah
0.7694%
0.7524%

0.7694%
0.7642%
0.7642%
raised in the initial round. These States
Vermont
0.4493%
0.2202%

0.4493%
0.4463%
0.4463%
must have their shares held constant or
Virginia
2.5178%
2.5103%

2.5178%
2.5009%
2.5009%
they will fall below the 90.5% return they
Washington
1.7562%
1.7272%

1.7562%
1.7444%
1.7444%
achieved in the initial round.
West Virginia
1.1121%
0.6311%

1.1121%
1.1046%
1.1046%
Wisconsin
1.9567%
1.7092%

1.9567%
1.9435%
1.9435%
e. Columns (5) and (6) show the
Wyoming
0.6829%
0.4597%

0.6829%
0.6783%
0.6783%
adjustment of the shares of the remaining
Total
100.00%
90.5000%
8
46.6069%
53.7552%
53.3931% 100.0000%
States so that the sum of the shares will
Sum of col. (4) and Col. (5) = 100.3622%
be 100%,

---

CRS-28
Step 5 - Check results of second adjustment process (Step 4). If any States are receiving less than the 90.5% guarantee, increase their shares to the
90.5% return level and adjust shares of other States so total remains 100%.
Revised
90.5 %
Any
Third Round of Share Adjustments
Shares
of State
States
Unadjusted
Reduced
Revised
State
for
Share of
Below
Shares
Shares for
Shares
Shares
Contribution
All States
s
90.5%
Raised
Remaining
on Other
Round 3
(Step 4,
(Step 1,
Level?
to 90.5%
States
States to
(col. (1)
col. (7))
col. (3))
<
Level
Keep Total
(from cols.
col. (2))
at 100%
(4) & (6))
(1)
(2)
(3)
(4)
(5)
(6)
(7)
The downward adjustments to States in the
second round brought two States —
Tennessee and Virginia — below the
Alabama
1.9780%
1.7828%
1.9780%
1.9775%
1.9775% minimum
90.5% return. The share for these States must
Alaska
1.1627%
0.1854%
1.1627%
1.1625%
1.1625% be
Arizona
1.6987%
1.6987%
1.6987%

1.6987% increased to meet to minimum 90.5% return
Arkansas
1.2895%
1.2039%
1.2895%
1.2892%
1.2892% and
the shares of other States must be
California
9.3274%
9.3274%
9.3274%

9.3274% reduced so that the sum of all the shares
Colorado
1.2832%
1.2832%
1.2832%

1.2832% remains at 100%. This is exactly the
Connecticut
1.4820%
0.9395%

1.4820%
1.4816%
1.4816% same process as the previous step. The
Delaware
0.4317%
0.2350%

0.4317%
0.4316%
0.4316% process is repeated until no State receives
Dist. of Col.
0.3861%
0.1041%

0.3861%
0.3860%
0.3860% less than the 90.5% return.
Florida
4.7758%
4.7758%
4.7758%
4.7758%
Georgia
3.5339%
3.5339%
3.5339%
3.5339%
Hawaii
0.5052%
0.2193%

0.5052%
0.5051%
0.5051% a. Column (1) shows the revised shares
Idaho
0.7532%
0.5054%

0.7532%
0.7530%
0.7530% from Step 4 — the second round of
Illinois
3.3003%
3.2094%
3.3003%
3.2995%
3.2995% adjustments.
Indiana
2.3019%
2.2805%

2.3019%
2.3013%
2.3013%
Iowa
1.1730%
1.0048%

1.1730%
1.1727%
1.1727% b. Column (2) shows the share (determined
Kansas
1.1434%
0.9671%

1.1434%
1.1431%
1.1431% in Step 1) necessary to provide a guaranteed
Kentucky
1.7354%
1.7354%
1.7354%
1.7354% 90.5%
return.
Louisiana
1.5860%
1.5860%
1.5860%
1.5860%
Maine
0.5136%
0.4905%

0.5136%
0.5135%
0.5135% c. Column (3) identifies the States whose
Maryland
1.6250%
1.6250%
1.6250%

1.6250% shares are below the minimum.
Massachusetts
1.8188%
1.7017%
1.8188%
1.8184%
1.8184%
Michigan
3.0774%
3.0538%

3.0774%
3.0766%
3.0766% d. Column (4) shows the shares raised for the
Minnesota
1.4631%
1.3564%

1.4631%
1.4628%
1.4628% two States that were below the minimum after
Mississippi
1.2115%
1.2115%
1.2115%

1.2115% the second round of adjustments. It also
Missouri
2.3045%
2.2775%

2.3045%
2.3039%
2.3039% shows, in italics, the shares for the States
Montana
0.9689%
0.4014%

0.9689%
0.9687%
0.9687% whose shares were raised in the initial and
Nebraska
0.7581%
0.6702%

0.7581%
0.7579%
0.7579% and second rounds. These States must have
Nevada
0.7073%
0.6543%

0.7073%
0.7071%
0.7071% their shares held constant or they will fall
New Hampshire
0.5038%
0.4143%

0.5038%
0.5037%
0.5037% below the 90.5% return level in the previous
New Jersey
2.6392%
2.6392%
2.6392%

2.6392% rounds of adjustments.
New Mexico
0.9645%
0.8096%

0.9645%
0.9643%
0.9643%
New York
5.0382%
3.6504%

5.0382%
5.0370%
5.0370% e. Columns (5) and (6) show the adjustment
North Carolina
2.7991%
2.7991%
2.7991%

2.7991% of the shares of the remaining States so that
North Dakota
0.6395%
0.2847%

0.6395%
0.6393%
0.6393% the sum of the shares will be 100%.
Ohio
3.4008%
3.4008%
3.4008%
3.4008%
Oklahoma
1.5166%
1.5166%
1.5166%
1.5166%
Oregon
1.1889%
1.0890%
1.1889%
1.1886%
1.1886%
Pennsylvania
4.8683%
3.6451%
4.8683%
4.8671%
4.8671%
Rhode Island
0.5814%
0.2428%

0.5814%
0.5813%
0.5813%
South Carolina
1.6460%
1.6460%
1.6460%
1.6460%
South Dakota
0.6976%
0.2918%

0.6976%
0.6975%
0.6975%
Tennessee
2.2099%
2.2125%
Yes
2.2125%
2.2125%
Texas
7.8284%
7.8284%
7.8284%
7.8284%
Utah
0.7642%
0.7524%

0.7642%
0.7640%
0.7640%
Vermont
0.4463%
0.2202%
0.4463%
0.4462%
0.4462%
Virginia
2.5009%
2.5103%
Yes
2.5103%
2.5103%
Washington
1.7444%
1.7272%

1.7444%
1.7439%
1.7439%
West Virginia
1.1046%
0.6311%

1.1046%
1.1043%
1.1043%
Wisconsin
1.9435%
1.7092%
1.9435%
1.9431%
1.9431%
Wyoming
0.6783%
0.4597%
0.6783%
0.6782%
0.6782%
Total
100.00%
90.5000%
2
51.3297%
48.6823%
48.6703%
100.0000%
Sum of col. (4) and col. (5) == 100.0120%

---

CRS-29
Step 6 - Check results of third adjustment process (Step 5). If any States are receiving less than the 90.5% guarantee, increase their shares to the
90.5% return level and adjust shares of other States sototal remains 100%.
Revised
90.5 %
Any
Shares
of State
States
Final
State
for
Share of
Below
Return on
All States
Contributions
90.5%
Highway
(Step 5,
(Step 1,
Level?
Account
col. (7))
col. (3))
(col. (1) <
Contributions
col. (2))
(1)
(2)
(3)
(4)
No further adjustments are needed.
The shares determined in Step 5 —
Alabama
1.9775%
1.7828%
No
100.4%
the third round of adjustments
Alaska
1.1625%
0.1854%
No
567.3%
brought all States up to the minimum
Arizona
1.6987%
1.6987%
No
90.5%
return of 90.5%
Arkansas
1.2892%
1.2039%
No
96.9%
California
9.3274%
9.3274%
No
90.5%
a. Column (1) shows the revised shares
Colorado
1.2832%
1.2832%
No
90.5%
from Step 5 — the third round of
Connecticut
1.4816%
0.9395%
No
142.7%
adjustments.
Delaware
0.4316%
0.2350%
No
166.3%
Dist. of Col.
0.3860%
0.1041%
No
335.5%
b. Column (2) shows the share (determined
Florida
4.7758%
4.7758%
No
90.5%
in Step 1) necessary to provide the guaranteed
Georgia
3.5339%
3.5339%
No
90.5%
90.5% return.
Hawaii
0.5051%
0.2193%
No
208.5%
Idaho
0.7530%
0.5054%
No
134.8%
c. Column (3) identifies the States whose
Illinois
3.2995%
3.2094%
No
93.0%
shares are below the minimum — none.
Indiana
2.3013%
2.2805%
No
91.3%
The shares determined in the third round
Iowa
1.1727%
1.0048%
No
105.6%
(and shown in column (1)) will be used
Kansas
1.1431%
0.9671%
No
107.0%
to calculate the Minimum Guarantee.
Kentucky
1.7354%
1.7354%
No
90.5%
Louisiana
1.5860%
1.5860%
No
90.5%
d. Column (4) shows each State’s percentage
Maine
0.5135%
0.4905%
No
94.7%
return on its Highway Account contributions.
Maryland
1.6250%
1.6250%
No
90.5%
This is computed as the final share of apportion-
Massachusetts
1.8184%
1.7017%
No
96.7%
ments from column (1) divided by the share
Michigan
3.0766%
3.0538%
No
91.2%
of contributions from step 1, column (2).
Minnesota
1.4628%
1.3564%
No
97.6%
Mississippi
1.2115%
1.2115%
No
90.5%
Missouri
2.3039%
2.2775%
No
91.6%
Montana
0.9687%
0.4014%
No
218.4%
Nebraska
0.7579%
0.6702%
No
102.3%
Nevada
0.7071%
0.6543%
No
97.8%
New Hampshire
0.5037%
0.4143%
No
110.0%
New Jersey
2.6392%
2.6392%
No
90.5%
New Mexico
0.9643%
0.8096%
No
107.8%
New York
5.0370%
3.6504%
No
124.9%
North Carolina
2.7991%
2.7991%
No
90.5%
North Dakota
0.6393%
0.2847%
No
203.2%
Ohio
3.4008%
3.4008%
No
90.5%
Oklahoma
1.5166%
1.5166%
No
90.5%
Oregon
1.1886%
1.0890%
No
98.8%
Pennsylvania
4.8671%
3.6451%
No
120.8%
Rhode Island
0.5813%
0.2428%
No
216.6%
South Carolina
1.6460%
1.6460%
No
90.5%
South Dakota
0.6975%
0.2918%
No
216.3%
Tennessee
2.2125%
2.2125%
No
90.5%
Texas
7.8284%
7.8284%
No
90.5%
Utah
0.7640%
0.7524%
No
91.9%
Vermont
0.4462%
0.2202%
No
183.4%
Virginia
2.5103%
2.5103%
No
90.5%
Washington
1.7439%
1.7272%
No
91.4%
West Virginia
1.1043%
0.6311%
No
158.4%
Wisconsin
1.9431%
1.7092%
No
102.9%
Wyoming
0.6782%
0.4597%
No
133.5%
Total
100.00%
90.5000%

---

CRS-30
Step 7 - Determine program level.
Sum of All
Program Size
Add
State
Apportionments
Minimum
Percent
(including MG)
(before MG)
MG Amount
Total
Share
Necessary
and High
of $1 Million
to Provide
Priority
State Shares
Projects
(col. (1) + (2))
(from Step 6) (col. (3) / col. (4))
-1-
-2-
-3-
-4-
-5-
The Minimum Guarantee provision ensures
that each State’s share of apportionments
Alabama
434,899,917
1,000,000
435,899,917
1.9775%
22,043,018,395
for the IM, NHS, STP, Bridge, CMAQ,
Alaska
104,850,848
1,000,000
105,850,848
1.1625%
9,105,774,570
ADHS, Recreational Trails, Metro Planning,
Arizona
316,379,875
1,000,000
317,379,875
1.6987%
18,683,489,297
and Minimum Guarantee, plus their funding
Arkansas
275,422,209
1,000,000
276,422,209
1.2892%
21,441,503,252
for High Priority Projects (excluding
California
2,122,252,227
1,000,000
2,123,252,227
9.3274%
22,763,522,956
#1818-1849) will be the share
Colorado
287,120,698
1,000,000
288,120,698
1.2832%
22,453,054,726
determined in Step 6 AND that no State
Connecticut
260,760,855
1,000,000
261,760,855
1.4816%
17,667,614,088
receives less than $1 million annually.
Delaware
93,207,279
1,000,000
94,207,279
0.4316%
21,826,592,553
Dist. of Col.
106,154,552
1,000,000
107,154,552
0.3860%
27,763,290,761
a. Column (1) shows the sum of the above
Florida
801,003,084
1,000,000
802,003,084
4.7758%
16,793,069,034
funding at the start of the calculation. At
Georgia
656,550,732
1,000,000
657,550,732
3.5339%
18,607,150,427
this point the Minimum Guarantee amount
Hawaii
108,828,704
1,000,000
109,828,704
0.5051%
21,744,743,711
is $0.
Idaho
148,416,893
1,000,000
149,416,893
0.7530%
19,843,191,635
Illinois
799,808,637
1,000,000
800,808,637
3.2995%
24,270,827,647
b. Columns (2) and (3) shown the addition
Indiana
446,645,810
1,000,000
447,645,810
2.3013%
19,451,809,342
of the $1 million minimum amount of MG
Iowa
293,005,587
1,000,000
294,005,587
1.1727%
25,070,772,454
funding to each State.
Kansas
287,795,475
1,000,000
288,795,475
1.1431%
25,263,327,596
Kentucky
398,709,329
1,000,000
399,709,329
1.7354%
23,033,027,825
c. Column (4) shows the percentage share
Louisiana
355,391,164
1,000,000
356,391,164
1.5860%
22,471,603,377
determined in Step 6.
Maine
117,790,671
1,000,000
118,790,671
0.5135%
23,134,790,173
Maryland
371,422,987
1,000,000
372,422,987
1.6250%
22,918,919,371
d. Column (5) shows how large the overall
Massachusetts
444,548,594
1,000,000
445,548,594
1.8184%
24,502,611,242
program (sum of the apportionments
Michigan
649,935,628
1,000,000
650,935,628
3.0766%
21,157,376,124
already made, the Minimum Guarantee,
Minnesota
356,028,578
1,000,000
357,028,578
1.4628%
24,407,935,031
and the High Priority Projects) would have
Mississippi
281,474,126
1,000,000
282,474,126
1.2115%
23,315,771,354
to be to deliver the percentage for that
Missouri
543,360,712
1,000,000
544,360,712
2.3039%
23,627,372,212
State considered by itself.
Montana
161,209,884
1,000,000
162,209,884
0.9687%
16,745,125,333
Nebraska
189,636,202
1,000,000
190,636,202
0.7579%
25,154,330,318
For example, going into the determination
Nevada
141,042,575
1,000,000
142,042,575
0.7071%
20,087,086,582
of the target program size, the District
New Hampshire
111,255,615
1,000,000
112,255,615
0.5037%
22,285,508,493
of Columbia (DC) has 0.496% of the total
New Jersey
617,498,072
1,000,000
618,498,072
2.6392%
23,434,920,610
program counting its original apportionments,
New Mexico
201,512,015
1,000,000
202,512,015
0.9643%
21,000,742,875
its High Priority Projects, and the $1 million
New York
1,121,902,959
1,000,000
1,122,902,959
5.0370%
22,293,257,085
of Minimum Guarantee that each State must
North Carolina
559,902,845
1,000,000
560,902,845
2.7991%
20,038,650,017
receive. In Step 6, we determined that DC
North Dakota
144,250,490
1,000,000
145,250,490
0.6393%
22,719,252,466
should get only 0.386 percent of the total
Ohio
760,051,996
1,000,000
761,051,996
3.4008%
22,378,666,264
program. In other words, DC has too big
Oklahoma
379,448,085
1,000,000
380,448,085
1.5166%
25,086,416,106
a share. None of the funding that DC has
Oregon
278,974,651
1,000,000
279,974,651
1.1886%
23,554,889,281
already received may be taken back. The
Pennsylvania
1,171,973,757
1,000,000
1,172,973,757
4.8671%
24,100,025,780
only way to change the ratio of DC funding
Rhode Island
128,447,434
1,000,000
129,447,434
0.5813%
22,269,452,838
to the national total funding is to change
South Carolina
317,128,305
1,000,000
318,128,305
1.6460%
19,327,393,680
the national total. The amount shown
South Dakota
152,517,716
1,000,000
153,517,716
0.6975%
22,010,494,655
for DC in column (5) shows the level to
Tennessee
500,816,813
1,000,000
501,816,813
2.2125%
22,681,217,948
which the national program would have to
Texas
1,487,004,971
1,000,000
1,488,004,971
7.8284%
19,007,664,509
be increased to reduce DC’s share of the
Utah
189,084,550
1,000,000
190,084,550
0.7640%
24,879,760,448
national program to 0.386%. This
Vermont
106,112,094
1,000,000
107,112,094
0.4462%
24,007,885,311
computation is performed for each State.
Virginia
522,853,208
1,000,000
523,853,208
2.5103%
20,868,123,109
Washington
425,887,052
1,000,000
426,887,052
1.7439%
24,478,428,408
The maximum required program size,
West Virginia
276,059,371
1,000,000
277,059,371
1.1043%
25,088,886,306
in this case for the District of Columbia,
Wisconsin
371,530,304
1,000,000
372,530,304
1.9431%
19,172,382,669
will be the target program size in the
Wyoming
163,277,555
1,000,000
164,277,555
0.6782%
24,224,093,907
Minimum Guarantee calculation.
Total
21,541,143,690
51,000,000 21,592,143,690
100.0000%

---

CRS-31
Step 8 - Calculate Minimum Guarantee apportionment to reach target program size.
Percent
State Share
Sum of All
Minimum
State
Share
of Target
Previous
Guarantee
from Step 6
Program
Apportionments
Apportionment
Size
and High Priority
Projects
(col. (2) - col. (3))
(1)
(2)
(3)
(4)
Alabama
1.9775%
549,018,103
434,899,917
113,452,596
In this step, we determine each State’s
Alaska
1.1625%
322,736,726
104,850,848
216,615,066
share of the target program size
Arizona
1.6987%
471,620,135
316,379,875
154,334,827
identified in Step 7. The amount
Arkansas
1.2892%
357,922,207
275,422,209
82,018,820
computed will be the TOTAL of the
California
9.3274%
2,589,602,192
2,122,252,227
464,624,163
State’s apportionments for IM, NHS,
Colorado
1.2832%
356,262,380
287,120,698
68,738,416
STP, Bridge, CMAQ, ADHS, Rec.
Connecticut
1.4816%
411,336,963
260,760,855
149,697,878
Trails, Metro Planning, and Minimum
Delaware
0.4316%
119,831,075
93,207,279
26,468,515
Guarantee, plus its High Priority
Dist. of Col.
0.3860%
107,154,552
106,154,552
994,168
Project funding.
Florida
4.7758%
1,325,918,733
801,003,084
521,854,097
Georgia
3.5339%
981,115,955
656,550,732
322,672,208
a. Column (1) shows the adjusted
Hawaii
0.5051%
140,227,279
108,828,704
31,215,444
State shares from Step 6.
Idaho
0.7530%
209,054,305
148,416,893
60,283,746
Illinois
3.2995%
916,041,404
799,808,637
115,554,843
b. Column (2) shows the application
Indiana
2.3013%
638,918,497
446,645,810
191,151,263
of the State shares in column (1)
Iowa
1.1727%
325,580,818
293,005,587
32,385,237
to the national total program size.
Kansas
1.1431%
317,373,581
287,795,475
29,405,593
In Step 7, we determined that the
Kentucky
1.7354%
481,797,113
398,709,329
82,603,177
national level program size would
Louisiana
1.5860%
440,315,332
355,391,164
84,428,851
be $27,763,290,761 — the highest
Maine
0.5135%
142,556,726
117,790,671
24,621,608
value in Step 7, column (5).
Maryland
1.6250%
451,142,024
371,422,987
79,254,078
Massachusetts
1.8184%
504,839,874
444,548,594
59,939,633
c. Column (3) shows the sum of all
Michigan
3.0766%
854,175,631
649,935,628
203,048,780
apportionments and High Priority
Minnesota
1.4628%
406,109,251
356,028,578
49,788,579
Project funding each State had
Mississippi
1.2115%
336,356,502
281,474,126
54,562,276
BEFORE the Minimum Guarantee
Missouri
2.3039%
639,649,835
543,360,712
95,727,520
calculation began.
Montana
0.9687%
268,942,757
161,209,884
107,104,525
Nebraska
0.7579%
210,408,635
189,636,202
20,651,278
d. Column (4) shows the Minimum
Nevada
0.7071%
196,323,608
141,042,575
54,958,608
Guarantee apportionment. It is the
New Hampshire
0.5037%
139,848,067
111,255,615
28,425,688
amount that each State must receive
New Jersey
2.6392%
732,733,091
617,498,072
114,562,915
in addition to the amounts shown in
New Mexico
0.9643%
267,723,860
201,512,015
65,825,667
column (3) so that all provisions of
New York
5.0370%
1,398,426,494
1,121,902,959
274,910,721
of the Minimum Guarantee are met.
North Carolina
2.7991%
777,123,647
559,902,845
215,953,869
The amount shown has been
North Dakota
0.6393%
177,498,428
144,250,490
33,054,021
reduced to comply with the
Ohio
3.4008%
944,171,900
760,051,996
183,046,031
0.65% across-the-board cut
Oklahoma
1.5166%
421,044,232
379,448,085
41,353,539
required by section 601 of
Oregon
1.1886%
329,995,932
278,974,651
50,723,701
P.L. 108-7. The $639 million of
Pennsylvania
4.8671%
1,351,268,739
1,171,973,757
178,249,251
the Minimum Guarantee that
Rhode Island
0.5813%
161,381,906
128,447,434
32,742,383
is exempt from the obligation
South Carolina
1.6460%
456,982,911
317,128,305
139,038,909
limitation is also exempt from
South Dakota
0.6975%
193,642,035
152,517,716
40,884,463
the cut as well.
Tennessee
2.2125%
614,256,524
500,816,813
112,778,078
Texas
7.8284%
2,173,434,545
1,487,004,971
682,425,997
Utah
0.7640%
212,115,090
189,084,550
22,896,215
Vermont
0.4462%
123,866,978
106,112,094
17,651,329
Virginia
2.5103%
696,942,837
522,853,208
173,074,257
Washington
1.7439%
484,172,805
425,887,052
57,945,803
West Virginia
1.1043%
306,593,118
276,059,371
30,355,660
Wisconsin
1.9431%
539,456,536
371,530,304
166,946,808
Wyoming
0.6782%
188,278,891
163,277,555
24,855,517
Total
100.0000%
27,763,290,761
21,541,143,690
6,185,856,616

---

CRS-32
Step 9A - Subdivision of Minimum Guarantee.
Minimum
Set Aside 2%
Remainder
State
Guarantee
for State
after
Apportionment
Planning
SPR
(from Step 8)
& Research
Setaside
(col. (1) * 2%)
(1)
(2)
(3)
Alabama
113,452,596
2,269,052
111,183,544
In this step, subdivide each
Alaska
216,615,066
4,332,301
212,282,765
State’s minimum guarantee
Arizona
154,334,827
3,086,697
151,248,130
apportionment.
Arkansas
82,018,820
1,640,376
80,378,444
California
464,624,163
9,292,483
455,331,680
a. Column (1) shows the minimum
Colorado
68,738,416
1,374,768
67,363,648
guarantee amount for each State from
Connecticut
149,697,878
2,993,958
146,703,920
step 8.
Delaware
26,468,515
529,370
25,939,145
Dist. of Col.
994,168
19,883
974,285
b. The first subdivision of the MG
Florida
521,854,097
10,437,082
511,417,015
apportionment is the setaside
Georgia
322,672,208
6,453,444
316,218,764
of 2% of the MG apportionment
Hawaii
31,215,444
624,309
30,591,135
for State Planning and Research.
Idaho
60,283,746
1,205,675
59,078,071
(This same setaside is made from
Illinois
115,554,843
2,311,097
113,243,746
the IM, NHS, STP, Bridge, and
Indiana
191,151,263
3,823,025
187,328,238
CMAQ programs.) Column (2)
Iowa
32,385,237
647,705
31,737,532
shows the SPR setaside from
Kansas
29,405,593
588,112
28,817,481
MG and is equal to 2% of column (1).
Kentucky
82,603,177
1,652,064
80,951,113
Louisiana
84,428,851
1,688,577
82,740,274
c. Column (3) shows the amount
Maine
24,621,608
492,432
24,129,176
remaining in the MG “pot” after
Maryland
79,254,078
1,585,082
77,668,996
the SPR setaside.
Massachusetts
59,939,633
1,198,793
58,740,840
Michigan
203,048,780
4,060,976
198,987,804
Minnesota
49,788,579
995,772
48,792,807
Mississippi
54,562,276
1,091,246
53,471,030
Missouri
95,727,520
1,914,550
93,812,970
Montana
107,104,525
2,142,091
104,962,434
Nebraska
20,651,278
413,026
20,238,252
Nevada
54,958,608
1,099,172
53,859,436
New Hampshire
28,425,688
568,514
27,857,174
New Jersey
114,562,915
2,291,258
112,271,657
New Mexico
65,825,667
1,316,513
64,509,154
New York
274,910,721
5,498,214
269,412,507
North Carolina
215,953,869
4,319,077
211,634,792
North Dakota
33,054,021
661,080
32,392,941
Ohio
183,046,031
3,660,921
179,385,110
Oklahoma
41,353,539
827,071
40,526,468
Oregon
50,723,701
1,014,474
49,709,227
Pennsylvania
178,249,251
3,564,985
174,684,266
Rhode Island
32,742,383
654,848
32,087,535
South Carolina
139,038,909
2,780,778
136,258,131
South Dakota
40,884,463
817,689
40,066,774
Tennessee
112,778,078
2,255,562
110,522,516
Texas
682,425,997
13,648,520
668,777,477
Utah
22,896,215
457,924
22,438,291
Vermont
17,651,329
353,027
17,298,302
Virginia
173,074,257
3,461,485
169,612,772
Washington
57,945,803
1,158,916
56,786,887
West Virginia
30,355,660
607,113
29,748,547
Wisconsin
166,946,808
3,338,936
163,607,872
Wyoming
24,855,517
497,110
24,358,407
Total
6,185,856,616
123,717,133
6,062,139,483

---

CRS-33
Step 9B - Subdivision of Minimum Guarantee.
Remainder
Base
Remainder
State
after
Minimum
after SPR
SPR
Guarantee
and Base
Setaside
$2.8 Billion
MG
(Step 9A)
(col. (1) * 0.4619)
col. (1) - col. (2)
(1)
(2)
(3)
Alabama
111,183,544
51,353,804
59,829,740
TEA-21 requires that $2.8 billion
Alaska
212,282,765
98,049,830
114,232,935
of the national total of MG
Arizona
151,248,130
69,858,962
81,389,168
have the same eligibilities
Arkansas
80,378,444
37,125,448
43,252,996
as STP funds, but that the $2.8 billion
California
455,331,680
210,310,025
245,021,655
is not subject to the setaside and
Colorado
67,363,648
31,114,133
36,249,515
suballocation requirements of the STP
Connecticut
146,703,920
67,760,067
78,943,853
program. (Setasides for safety and
Delaware
25,939,145
11,980,854
13,958,291
transportation enhancements and
Dist. of Col.
974,285
450,006
524,279
suballocation for various sub-State
Florida
511,417,015
236,214,895
275,202,120
areas)
Georgia
316,218,764
146,056,115
170,162,649
Hawaii
30,591,135
14,129,529
16,461,606
The remainder of the MG funds are
Idaho
59,078,071
27,287,165
31,790,906
redistributed to the 5 core programs:
Illinois
113,243,746
52,305,377
60,938,369
IM, NHS, STP, Bridge, and CMAQ.
Indiana
187,328,238
86,523,754
100,804,484
Iowa
31,737,532
14,659,031
17,078,501
a. Column (1) shows the amount
Kansas
28,817,481
13,310,308
15,507,173
of MG left after setting aside 2%
Kentucky
80,951,113
37,389,955
43,561,158
for the SPR program in step 9A.
Louisiana
82,740,274
38,216,338
44,523,936
This totals $6.062 billion.
Maine
24,129,176
11,144,859
12,984,317
Maryland
77,668,996
35,874,000
41,794,996
b. Column (2) shows the calculation
Massachusetts
58,740,840
27,131,403
31,609,437
of the portion of the $2.8 billion for
Michigan
198,987,804
91,909,111
107,078,693
each State. It is calculated by
Minnesota
48,792,807
22,536,575
26,256,232
multiplying the remaining funds
Mississippi
53,471,030
24,697,367
28,773,663
after the SPR setaside (col. 1)
Missouri
93,812,970
43,330,629
50,482,341
by 0.4618831 — the ratio of the
Montana
104,962,434
48,480,379
56,482,055
$2.8 billion to $6.062 billion.
Nebraska
20,238,252
9,347,707
10,890,545
Nevada
53,859,436
24,876,765
28,982,671
c. Column (3) shows the remainder
New Hampshire
27,857,174
12,866,758
14,990,416
after the SPR setaside and the
New Jersey
112,271,657
51,856,384
60,415,273
determination of the base MG amount.
New Mexico
64,509,154
29,795,691
34,713,463
This remainder is distributed to the
New York
269,412,507
124,437,094
144,975,413
five core programs — IM, NHS, STP,
North Carolina
211,634,792
97,750,542
113,884,250
Bridge, and CMAQ in the same
North Dakota
32,392,941
14,961,753
17,431,188
proportions that those programs
Ohio
179,385,110
82,854,957
96,530,153
make up of the State’s core program
Oklahoma
40,526,468
18,718,492
21,807,976
total.
Oregon
49,709,227
22,959,854
26,749,373
Pennsylvania
174,684,266
80,683,717
94,000,549
Rhode Island
32,087,535
14,820,691
17,266,844
South Carolina
136,258,131
62,935,332
73,322,799
South Dakota
40,066,774
18,506,167
21,560,607
Tennessee
110,522,516
51,048,487
59,474,029
Texas
668,777,477
308,897,039
359,880,438
Utah
22,438,291
10,363,867
12,074,424
Vermont
17,298,302
7,989,793
9,308,509
Virginia
169,612,772
78,341,279
91,271,493
Washington
56,786,887
26,228,905
30,557,982
West Virginia
29,748,547
13,740,352
16,008,195
Wisconsin
163,607,872
75,567,717
88,040,155
Wyoming
24,358,407
11,250,738
13,107,669
Total
6,062,139,483
2,800,000,000
3,262,139,483

---