Funding

CUUATS staff establishes the 25-year vision for the Metropolitan Planning Area (MPA) transportation system to correspond with available funding for future infrastructure projects. The proposed future projects in the LRTP 2045 align with collective transportation goals for the region, such as reducing emissions, crashes, and the number of roads and bridges in poor condition. This chapter will outline existing revenue sources and expenditures for the transportation system as well as document how staff and local agencies project revenues for the 25-year planning horizon.

Predicting future revenues is a somewhat elusive exercise, yet there are guidelines to be followed. By federal law, the LRTP must include a financial plan that demonstrates how the adopted transportation plan can be implemented. In order to address this requirement and provide transparency about project implementation, the future transportation projects listed in this plan are labeled according to whether or not they have secured funding prior to this plan being approved. In addition, this chapter will include additional information on the agencies and federal funding sources that directly impact the transportation system in the Metropolitan Planning Area (MPA).

There are two basic categories for transportation spending:

1. Operations and Maintenance – keeping the existing transportation infrastructure in good operational condition through resurfacing, reconstruction, and repairing as periodically needed.

2. Expansion – creating new transportation infrastructure to increase access for additional transportation modes or for all modes to additional locations.

Securing funding for expansion projects requires increasing the operations and maintenance budget to accommodate the ongoing upkeep of additional transportation infrastructure. To effectively choose where and how roadways are resurfaced, upgraded, or expanded, transportation officials must use asset management practices, such as life cycle cost analyses, to maximize transportation funding resources, including taxpayer dollars.

Revenues

Much of the transportation funding at the local, state, and federal level relies on the Motor Fuel Tax (MFT) revenue system. The MFT is a user-based fee where an excise tax is imposed on the sale of motor fuel in order to fund transportation system maintenance and improvements for motor vehicles. MFT can be collected at the federal, state, and local levels. Unfortunately, MFT is not currently sufficient to support the operations, maintenance, and expansion of today’s transportation system.

Under current federal law, the federal MFT rate is 18.3 cents per gallon on gasoline and 24.3 cents per gallon on diesel fuel. The federal MFT hasn’t been increased to keep up with inflation or increasing construction costs since 1993 In the past two decades, motor vehicles have increased their fuel efficiency, meaning drivers can operate their vehicles on increasingly smaller amounts of fuel. To begin to address these funding shortfalls, in 2012 both the Cities of Champaign and Urbana imposed an additional $0.04/gallon Motor Fuel Tax at the local level.

Fortunately, a new state bill passed in 2019, Rebuild Illinois will double the state MFT from $0.19 to $0.38. Of the increased state MFT revenue, 32 percent will go to units of local government through the motor fuel tax formula and another 20 percent will go to local transit districts. Until this bill is fully implemented, the impacts of the additional MFT financing are largely unknown.

In addition to MFT, there are many different strategies being tested around the country to address improve transportation infrastructure funding, including mileage-based user fees, local sales taxes, public-private partnerships, infrastructure banks, short-term federal discretionary grants, and additional toll roads. It is unknown at this time if any of these revenue sources will eventually replace MFT revenues at the local, state, and/or federal levels.

Federal

On December 4, 2015, President Obama signed into law the Fixing America’s Surface Transportation Act (FAST Act). The FAST Act funds surface transportation programs – which include, but are not limited to, Federal-aid highways – at over $305 billion for fiscal years (FY) 2016 to 2020. The FAST Act builds on the existing transportation bill passed in 2012, Moving Ahead for Progress in the 21st Century (MAP-21), which supports the maintenance of the country’s existing transportation infrastructure and guides future growth and development of the transportation network. The Federal Highway Administration works with local stakeholders to ensure that individual communities are able to both maintain and construct safe, multimodal, sustainable transportation projects ranging from passenger rail and public transportation infrastructure to bicycle and pedestrian facilities.

Federal transportation grants require different levels of local matching funds, ranging from 10 percent to 50 percent. The FAST Act authorizes a single amount each year for all the apportioned highway programs combined, as dictated by MAP-21. This includes the National Highway Performance Program (NHPP), the Surface Transportation Block Grant Program (STBG) (formerly Surface Transportation Program), Highway Safety Improvement Program (HSIP) (including Railway-Highway Crossings), Congestion Mitigation and Air Quality Improvement Program (CMAQ), and Metropolitan Planning, plus a newer National Highway Freight Program (NHFP).

State

On June 1, 2019, Illinois legislators passed Rebuild Illinois, a six-year infrastructure bill that includes $44.8 billion invested over six years, of which $33.2 billion are dedicated to transportation across all modes. The bill includes $10.44 billion in new state level funding that will maintain, enhance, and upgrade Illinois’ highway network. It also includes both a transit bonding component and a new state source recurring revenue for ongoing capital funding totaling $4.5 billion over the life of the six-year program: $3 billion in new bond funding and $1.5 billion in new recurring revenue for mass transit throughout the state, of which downstate transit districts will receive $300 million in bond proceeds and $150 million in recurring revenue to maintain and improve their systems. Rebuild Illinois also includes a $3.9 billion increase in direct funding for roads and bridges to municipalities through state bonding ($1.5 billion) and additional MFT revenues ($2.4 billion). A portion of state MFT revenues are distributed by IDOT to counties, townships, and municipalities for use in transportation-related expenditures. The MFT revenue increase from $0.19 to $0.38 in 2019 will continue as an ongoing source of income for the local roads system into the future.

The Illinois Department of Transportation (IDOT) receives funding from the state to maintain its highways and is also charged with distributing federal funding from the aforementioned MAP-21 Programs to the state Metropolitan Planning Organizations (MPO). The allocation for each MPO is based on urbanized area population. Most state funding allocated to projects in the urbanized area require at least a 20 percent local match from an MPO member agency or outside source such as a private party. The Illinois Department of Natural Resources (IDNR) also provides funds for greenways and trails projects with a required local match. Many local bike paths and trails have been funded, in part, by IDNR.

Local

Transportation projects receive local funding through municipal and county budgets, local MFT, public transit fares, local park district budgets (for greenways and trails projects), the University of Illinois, and private donations.

Forecasting Revenues, 2020-2045

What follows is a summary of CUUATS’ methodology for estimating revenues for the 25-year planning horizon on a source-by-source basis. As with most projections about the future, uncertainty increases as the planning horizon moves further out. Many factors affect transportation projects, which makes the determination for funding complex at the federal, state, and local levels. The funding projections shown in this chapter will be based on projects documented in past and current versions of the local Transportation Improvement Program (TIP) as well as future growth rates provided by the different agencies involved.

Federal

Federal funding fluctuates annually by millions of dollars. In order to provide a reasonable estimate, four different calculations were completed based on varying program funds:

• All federal program funds, with the exception of STBGP/STPU Local dollars and transit funding, were calculated for the FY 2020-23 Transportation Improvement Program (TIP). The estimated funding for 2020-2023 was $202,291,818.

• To estimate the remaining 21 years of federal funding, the average was taken of the previous five years’ (FY 2015 - 2019) of federal funding allocations, not including the STP-U Local and transit apportionment, as documented in the annual listing of Federally Obligated Projects. A 4 percent annual growth rate was applied to the annual average and projected to 2045, which produced an estimate for federal funding for 2024 - 2045 of $547,207,310.

• STP-U Local funding was estimated by applying a 4 percent annual growth rate to the FY2020 allocation of ($1,615, 236.95 for Champaign-Urbana and $101,651.92 for Mahomet) through 2045 for a total of $76,078,341.

• The Champaign-Urbana Mass Transit District estimates there will be $100,000,000 available in the next 25 years through FTA Formula Capital funds, which are used for fleet expansion and replacement.

• The Champaign-Urbana Mass Transit District was awarded a $17,275,000 grant from the U.S. Department of Transportation’s Buses and Bus Facilities Grant Program for the Illinois Terminal Expansion Project scheduled to begin in Fiscal Year 2020 or 2021.

2020-2045 total for all Federal programs: $942,852,469

State

The forecast for future state funding is composed of three steps: total annual state-only funds allocated for projects in the FY 2020-2023 TIP, projected state funds available for FY 24-45 based on the FY2015-2019 average, and total annual funds allocated for projects in the TIP FY 20-23 by the Illinois Department of Natural Resources. Although the state recently passed a six-year infrastructure bill, Rebuild Illinois, that includes $33.2 billion in transportation, at this time it is unclear how, where, and when any of that money will be invested at the local level.

• Total of state-only funds allocated for projects in TIP FY 2020-2023 is $8,273,000.

• To estimate the remaining 21 years of state funding, the average was taken of the previous five years’ (FY 2015 - 2019) of state funding allocations, not including transit funding, as documented in the annual TIP documents, with an attempt to eliminate funding redundancies of projects that carryover year to year. A 4 percent annual growth rate was applied to the annual average and projected to 2045, which produced an estimate for state funding for 2024 - 2045 of $233,621,151.

• Funding from the Illinois Department of Natural Resources is not a fixed part of the annual budget; rather, it is based on the approval of intermittent grant applications. The only reasonably guaranteed funding from this source is that which would be listed in the current TIP, however no IDNR funding is listed in the current TIP.

2020-2045 total for all State programs: $241,894,151

Local

To estimate local transportation revenues from 2020-2045, each local agency provided local budget projections including motor fuel tax revenues estimates and future growth rates, when possible. Local budget estimates are limited to funding spent for transportation improvements, operations, and maintenance.

City of Champaign

The City of Champaign provided estimates for revenues through 2030 and projections that reflect an annual growth rate of approximately 0.5 percent between 2030 and 2045 for an estimated total transportation revenue of $233,426,138.

City of Urbana

The City of Urbana provided estimates for revenues through 2021 and projections that reflect an annual overall growth rate of approximately 0.5 percent between 2022 and 2045 for an estimated total transportation revenue of $93,231,495.

Village of Savoy

The Village of Savoy provided an estimate for revenues through 2045 that includes an annual growth rate of 0.5 percent between 2023 and 2045 for an estimated total transportation revenue of $13,167,338.

Village of Mahomet

The Village of Mahomet provided an estimate for revenues through 2045 that does not include an annual growth rate for an estimated total transportation revenue of $15,304,034.

Village of Tolono

The Village of Tolono provided estimates for revenues through 2045 that do not include any annual growth rates for an estimated total transportation revenue of $2,210,000.

Village of Bondville

The Village of Bondville does not have any official plans related to transportation funding, therefore no reasonably guaranteed funding is anticipated.

Champaign County

Champaign County contributions within the MPA are on a project-by-project basis. Only those projects that have established agreements with the County for MPA transportation projects, as documented in the FY 2020-2023 TIP can be considered reasonably guaranteed. At this time, estimated funding from the County through 2045 is $2,347,222.

MTD

The Champaign-Urbana Mass Transit District receives an allocation from the state and uses its local revenues to cover operations and maintenance for its system. The Champaign-Urbana Mass Transit District provided projections for local and state operating revenues through 2045 that reflect an annual growth rate of approximately 5 percent for an estimated total of $1,818,000,000.

University

The University of Illinois has no reasonably guaranteed funds for transportation improvements or maintenance with the exception of what is listed in the FY 2020-2023 TIP. At this time, estimated transportation funding from the University through 2045 is $3,373,523.

Willard Airport

The University-owned Willard Airport in Savoy reported $3,000,000 in revenues for FY 2019. Staff at the University was unable to provide a formal projection to the year 2045, so $3,000,000 was assumed to be the annual budget each year from 2020 through 2045 for a total of $78,000,000.

Private Sources

The only reasonably guaranteed private transportation funds are found in the FY 2020-2023 TIP, where there are currently two projects that are partially funded with private funds from Carle Health System totaling $29,119.

2020-2045 total for all local programs: $2,259,088,869

Forecasting Expenditures, 2020-2045

To operate, maintain, and expand our local area transportation network, local agencies project they will spend all future revenues through 2045. Without future projections for state and federal expenditures, the only state and federal expenditures reflected in the table below are those documented in the current TIP FY2020-2023.

Summary of Revenue and Expenditure Projections, 2020-2045