The current rating of North Carolina’s Transportation system according to ITRE.

MEDIOCRE

To improve the transportation network’s condition, ITRE finds that a minimum annual additional investment of $1.3 billion is needed to achieve “good” condition and $3.2 billion for “excellent condition.”

Outdated Funding Model

North Carolina currently relies on user fees to fund the state’s transportation system’s construction, maintenance, and operation.  A user fee is paid by users of the transportation system through various methods. An example is a driver’s license or vehicle registration fee, the Highway Use Tax, or the “Gas Tax.”

IN FISCAL YEAR 2021-2022

NCDOT collected a total of $4.325 billion in state-based revenue – most of which was derived from user-based sources such as the state gas tax and vehicle registration fees. Specifically, the state collected:

in state motor fuel tax

in vehicle registration and license fees

in other fees

Highway & Ferry System

More fuel-efficient cars mean less gas tax.

Cars last longer meaning less Highway Use Tax.

Hybrid and EV icon

Technological Innovation

There has been an increase in Hybrids and EVs and those types of cars pay no gas tax, yet still use the transportation system.

Change in Consumer Habits

The pandemic caused the need for remote working and increased e-commerce meaning the use of the transportation system changed.

There is not enough money invested in our system.

Congestion Hexagon

With the influx of people moving here, there is more use and congestion in certain areas.

Storm Hexagon

With more intense storm events, the cost to repair has increased and is more frequent.

The “Gas Tax”

Gas tax revenues are NCDOT’s largest funding source, and the law requires these revenues be used only for transportation purposes.

Motor Fuel Tax

Revenues are deposited into two funds.

Beginning in FY 2020-2021, an additional statutory change will increase maintenance funding by shifting the distribution of motor fuel tax proceeds.

Highway Fund:

FY 2020-2021
FY 2021-2022
Future Years

Highway Trust Fund:

FY 2020-2021
FY 2021-2022
Future Years

Gas Tax = Unreliable Revenue Source

Gas Tax revenues are North Carolina’s largest funding source for transportation infrastructure.

As cars become more fuel-efficient or carmakers transition to hybrid and electric vehicles, the Gas Tax will continue to become a more unreliable revenue source to fund our transportation needs.

Estimates from NCDOT suggest that the average North Carolina Driver logs 12,000 miles per year.

The average miles per gallon of those cars is 22 miles.

The average driver pays approx. $200 dollars/year in Gas Tax (less than $17/month) based on current Gas Tax.

cell phone

Average Cell Phone Plan Cost

The average individual cell phone plan can cost a North Carolinian approximately $540 per year.

Cell Phone > Transportation System
We pay more for a cell phone plan than we do to fund our transportation system, which is vital to our economic success.

Costly & Dangerous

Due to an influx of people moving here and a lack of investment and resources, our roads are deteriorating, unsafe, and congested, costing NC drivers $3.4 BILLION each year and too many lives.

Lack of Investment

NC ranks 44th in per-mile investment in state-maintained roads.

Dangerous Road

NC ranks in the Top 10 for states with the most dangerous roads.

Unsafe Roads

Our rural fatality rate is one of the highest in the nation because our rural roads are unsafe and not adequately maintained.

Congested Roads

Charlotte, the Triangle, and the Triad rank among the nation’s 100 Most Congested Cities in 2019.

Other Factors

Electric Car

Electric Vehicles & Hybrids

There has been an increase in hybrids and electric vehicles on our roads. EVs and hybrids pay little to no gas tax, yet still, use our transportation systems.  As more automakers transition completely to electric vehicles, the current “gas tax” reliant model will be unsustainable.

Cell Phone and Laptop

Changes in Consumer Habits

The pandemic caused the need for remote working and increased e-commerce meaning the use of the transportation system changed.  It is hard to predict what the future holds and whether the changes to consumer habits impact the current model moving forward and what new opportunities exist.

Technological Innovation

Drones, autonomous cars, and technology-based companies that help people get around like Uber, Bird, or ZipCar will transform how goods and services move.  It also greatly disrupts the current funding model.

Storm Hexagon

More Frequent & Intense Storms

With more intense storm events, the cost to repair has increased and is more frequent.  Rebuilding stronger and more resilient costs more.

Research Resources

Issue Brief 1 - NC Motor Fuels Tax
Issue Brief 2 - Changing Demographics and Future of Transportation
Issue Brief 3 - NC Highway Use Tax
Issue Brief 4 - Rural Transportation Issues
Issue Brief 5 - Transportation Distribution and Logistics
Issue Brief 6 - DMV Fees
Issue Brief 7 - Micromobility
Issue Brief 8 - Electric Vehicles
Issue Brief 9 - How Other States and Countries Pay for Transportation
Issue Brief 10 - Future of Tolling
Issue Brief 11 - Top 10 Myths about Transportation Fundings
Issue Brief 12 - Mileage Based User Fees
Issue Brief 13 - Transportation Finance
Issue Brief 14 - Technology and Transportation