Warnings continue over TN’s lack of sustainable transportation funding, even with toll lane project

Officials with the Tennessee Department of Transportation warned again that the state’s transportation infrastructure needs continue to outpace revenues, even as a toll lane project takes shape. 

Last week, Gov. Bill Lee announced the first phase of the toll project, with a team of companies chosen to begin construction on a lane connecting Murfreesboro to Nashville. 

“This is the right tool for the challenge but not a silver bullet,” said Bryan Ledford, the major projects bureau chief at the Tennessee Department of Transportation.

Ledford’s comments came during the August meeting of the Tennessee Transportation Modernization board, which oversees toll lane projects. He added that pay-as-you-go lanes could work for urban congestion, but they “are not a replacement for sustainable transportation funding.” 

Tennessee has somewhere between $58 and $87 billion in transportation infrastructure needs over the next 30 years, according to a draft report from the Tennessee Advisory Committee on Intergovernmental Relations, TACIR.

The report details how Tennessee will need to generate $3.6 billion a year to maintain and improve its current infrastructure.

Tennessee Transportation Department wants $308 million injection

The transportation department told TACIR it expects a $400 million funding deficit in 2027-28, which could grow to $4.5 billion per year over the next 30 years because gas taxes aren’t expected to grow at all. 

The Sycamore Institute, a nonpartisan think tank, forecast in its latest state budget report released earlier this month that the state’s $1.2 billion gas tax revenues aren’t even keeping up with inflation. 

For more than a decade, Tennessee hasn’t generated enough tax revenue to meet its growing transportation infrastructure needs. 

In 2017, lawmakers increased the gas tax by 30% to prop up infrastructure revenue. Gas tax collections across the country have been falling for years as the fuel efficiency of cars and trucks continues to improve, reducing the amount of fuel purchased.

Tennessee is also one of only a handful of states that doesn’t borrow money to pay for roads, leaving it with few options to raise the money needed for new road and bridge projects. 

These circumstances led Gov. Bill Lee to push through the 2023 Transportation Modernization Act, which allowed the state to pursue toll lanes and dedicated around $3 billion in one-time funds for road construction. Lee signed an executive order last week creating a board of state officials and lawmakers to handle toll lane projects. 

The new toll lanes are expected to ease some urban congestion, but the state likely needs another approach to cover the transportation funding deficit, according to the TACIR draft report.