Government Funding Sources

Federal: transportation

Highlights of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users, or "SAFETEA-LU" bill include:

  • Six-year funding bill signed into law on August 10, 2005.
  • Authorizes $244.1 billion in Federal gas-tax revenue and other federal funds for all modes of surface transportation.
    • Includes highways, bus and rail transit, bicycling, and walking.
  • Bicycle and pedestrian programs can be included in programs eligible for over half the funds.
  • None of the funds are dedicated solely for bicycle or pedestrian facilities or programs.

Transportation Enhancements

In1991, Congress passed the Intermodal Surface Transportation Efficiency Act (ISTEA) to promote balanced, multimodal transportation. The creation of Transportation Enhancements (TE), which have provided funding for more than 24,000 projects, was one of the most important features. Subsequent transportation legislation has expanded the TE program to comprise a 10% set-aside of the Surface Transportation Program, which translates to more than $800 million (FY 2005-2009).

Funding is available to local governments, communities, and non-profits that have projects directly related to surface transportation. As TE funds are administered to states, the details of individual state programs are different, but each state works with FHWA to ensure that projects meet the specified criteria. Descriptions and state profiles are available through the TE website. In addition to relating to surface transportation, projects also must pertain to one of the following twelve eligible activities:

  • Provision of pedestrian and bicycle facilities
  • Provision of pedestrian and bicycle safety and education activities
  • Acquisition of scenic or historic easements and sites
  • Scenic or historic highway programs including tourist and welcome centers
  • Landscaping and scenic beautification
  • Historic Preservation
  • Rehabilitation and operation of historic transportation buildings, structures, or facilities
  • Conversion of abandoned railway corridors to trails
  • Control and removal of outdoor advertising
  • Archaeological planning and research
  • Environmental mitigation of highway runoff pollution, reduce vehicle-caused wildlife mortality, maintain habitat connectivity
  • Establishment of transportation museums

TE are administered as a reimbursable cost share program that has standard Federal requirements regarding highways, environmental controls, planning, and accessibility. Generally, applicants can expect an 80% Federal share, but additional funding from other sources can contribute to the 20% required match. Funding administration can vary by state, with innovative measures including advance payment and consideration of the value of local land, services, and materials.

Congestion Mitigation and Air Quality (CMAQ) Improvement Program

The Congestion Mitigation and Air Quality (CMAQ) Improvement Program was created in 1991 under the Intermodal Surface Transportation Efficiency Act (ISTEA) to fund transportation related projects that are designed to reduce traffic congestion and improve air quality. CMAQ has seven major project categories:

  1. Transit
  2. Shared Ride
  3. Traffic Flow Improvements
  4. Demand Management
  5. Pedestrian/Bicycle
  6. Inspection/Maintenance (I/M) and other Transportation Control Measures (TCMs)
  7. Surface Transportation Program (STP)/CMAQ

Pedestrian and bicycle projects comprise one major product category and account for approximately 13 percent of CMAQ projects. CMAQ Improvement Program funds are available to a wide range of government and non-profit organizations, as well as private entities contributing to public/private partnerships. They are controlled by metropolitan planning organizations (MPOs) and state departments of transportation. Often, these organizations plan or implement their own air quality programs besides approving CMAQ funds for other projects. Funding is available for areas that do not meet the National Ambient Air Quality Standards (nonattainment areas) as well as former nonattainment areas that are now in compliance (maintenance areas). CMAQ-funded projects may include bicycle and pedestrian facility improvements, bicycle racks and lockers, and individualized marketing initiatives that promote bicycling and walking.

Federal Highway Administration’s (FHWA) Final Program Guidance for the Congestion Mitigation and Air Quality Improvement Program under the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users provides several examples of eligible nonmotorized CMAQ activities:

  • Constructing bicycle and pedestrian facilities (paths, bike racks, support facilities, etc.) that are not exclusively recreational and have the potential to reduce vehicle trips
  • Non-construction outreach related to safe bicycle use
  • Establishing and funding State bicycle/pedestrian coordinator positions for promoting and facilitating nonmotorized transportation modes through public education, safety programs, etc. (Limited to one full-time position per State).

CMAQ-funded bicycle/pedestrian projects can be based around efforts such as bike parking, pedestrian and bicycling promotion, sidewalk or pedestrian improvements and enhancements, bike maps and planning, and education efforts. Bicycle and pedestrian projects often work to improve mobility and access while also improving safety. These projects can help reduce the need for automobiles and provide safe connections for walkers and bikers.

For more information about CMAQ, take a look at PBIC’s CMAQ FAQ or visit the FHWA program web site. The League of American Bicyclists’ report Congestion Mitigation and Air Quality (CMAQ) Improvement Program provides a chart of project ideas by type, location, and description. A list of currently designated nonattainment areas for all criteria polluntants is available through the Environmental Protection Agency (EPA).


Recreational Trails Program

The Recreational Trails Program ( RTP) is an assistance program of the US Department of Transportation’s Federal Highway Administration (FHWA) initially created under the Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA). The program was amended by the Transportation Equity Act for the 21st Century (TEA-21) by increasing the funds significantly.

RTP is aimed at providing funds to develop and maintain recreational trails and trail related facilities. Funding can be used for both motorized (snowmobiles, four-wheel vehicles, all terrain vehicles, etc.) and non-motorized (pedestrian, bicycling, equestrian, skiing, etc.) recreational trail use.

Every State administers their own program and develops their own procedures for selecting projects that will receive funding. To assist with the RTP, each State has their own State Recreational Advisory Committee that can either select projects for funding or be solely advisory. A list of Recreational Trails Program State Administrators can be found here.

In 2009, Congress authorized the RTP for $85 million. Up to $840,000 of this money may be used by FHWA annually to trail related research, program, administration, and technical assistance. Half of the remaining funds are distributed to all States equally while the second half of the remaining funds are distributed in proportion to the amount of off-road recreation fuel use in each State. The money provided to each state must be split between varying recreational trail projects – 30% of funds must be allotted to motorized trail uses, 30% for non-motorized trail uses, and 40% for diverse trail users. For a list of previous funding amounts provided to each state, visit

The Federal share of funding for each project from RTP funds is 80%, however a Federal agency project sponsor may endow additional funds provided the Federal share does not exceed 95%. The remaining funds must come from project sponsors or various other funding sources. It is possible for the remaining funding to come from a Federal program in the project is eligible under said program as well.

As listed by FHWA, RTP funds may be used for:

  • Maintenance and restoration of existing trails.
  • Development and rehabilitation of trailside and trailhead facilities and trail linkages.
  • Purchase and lease of trail construction and maintenance equipment.
  • Construction of new trails (with restrictions for new trails on Federal lands).
  • Acquisition of easements or property for trails.
  • Assessment of trail conditions for accessibility and maintenance.
  • Development and dissemination of publications and operation of educational programs to promote safety and environmental protection related to trails (including supporting non-law enforcement trail safety and trail use monitoring patrol programs, and providing trail-related training) (limited to 5 percent of a State's funds).
  • State administrative costs related to this program (limited to 7 percent of a State's funds).

The Coalition for Recreational Trails has compiled a database of RTP projects funded from 1993 to 2009.


Federal: non-transportation

There is a wide range of other federal funds that can be used for bicycling and walking facilities. The most common include:

  • Funds through federal land agencies such as the National Forest Service, National Park Service or Bureau of Land Management. These funds are primarily for trails and must be on federal lands.
  • Community Development Block Grants through HUD, the Department of Housing and Urban Development provides funds for community-based projects. Examples of the types of projects they fund are:
    • Commercial district streetscape improvements
    • Sidewalk improvements
    • Safe routes to school
    • Neighborhood-based bicycling and walking facilities that improve local transportation options or help revitalize neighborhoods.

The National Transportation Enhancements Clearinghouse has prepared a useful Technical Brief: Financing and Funding for Trails that cites over thirty federal and national funding sources that could be used to help fund bicycling and walking facilities and/or programs, especially trails.

State: transportation

Every state raises revenue for highway and transportation infrastructure through a state motor-vehicle fuel tax. Some states also raise funds through vehicle licensing fees. In many states, the laws governing how these funds can be spent would make most pedestrian projects and programs eligible for these funds. However in other states, use of the funds may be limited to providing paved highway shoulders on state owned and operated roads. The following are some examples of dedicated funding for bicycle and pedestrian projects from state transportation revenues:

  • Oregon dedicates 1 percent of state gas-tax revenue to providing improvements for bicycling and walking on state-managed highways. Michigan also has a 1 percent law.
  • Illinois has a long-standing, annual dedication of $1.50 out of the car title transfer tax, for trail and bicycle pedestrian improvements in local communities; raising up to $5 million annually.
  • California dedicates $1 million from the State Highway Account (gas tax-based), for bicycle transportation improvements, and the amount is scheduled to grow to $2 million in 2001 2002, to $3 million in 2003 and to $5 million in 2004. Maximum grants are $250,000.
  • California's Transportation Development Act dedicates .25 percent from the statewide 7.75 percent sales tax to public transit support. The funds are returned to the county of origin where the regional transportation planning agency may set-aside 2 percent of the funds for bicycle and pedestrian projects. In San Diego County, where this set-aside has been established, funding levels amount to about $1.7 million per year.
  • A Gubernatorial directive created New Jersey's bicycle and pedestrian facility set-aside in its local-aid program. Municipalities and counties can apply for these funds for local projects. The money comes from the NJ Transportation Trust Fund, which is mostly state gas taxes and highway toll revenue. Spending of funds has lagged, although local requests exceed actual awards for projects. Advocates are currently promoting a provision in the Trust Fund reauthorization bill that would require the NJ Department of Transportation to implement 200 miles of bikeways per year during the 4-year life of the new Trust Fund.
  • California allocates 1/3 of the federal Hazard Elimination monies (a portion of the 10 percent Safety Set-Aside of Surface Transportation Program funds) to projects that encourage kids to walk and bicycle to school. This amounts to about $20 million annually for the next two years.
  • New York State DOT is in the process of creating a grant program for traffic calming projects on Long Island. Towns and villages will apply for the money with specific traffic calming project proposals. The first year of the program will use $3 million of the federal Hazard Elimination funds.
  • Indiana drivers pay extra for special license plates that benefit greenways, open space, parks and trails. In 1995 about $1.9 million was netted from sale of 75,740 plates. The plates cost an additional $35, of which $25 goes to the Indiana Heritage Trust. Maine and Florida use similar license plate fee add-ons for conservation, parks and bicycle and pedestrian program funding.

State: non-transportation

A growing number of states are providing funds from non-transportation related revenue streams. However, these funds are not always eligible for the full range of bicycle and pedestrian activities. Some examples include the following:

  • Colorado dedicates a portion of its lottery proceeds to trail building.
  • Maryland uses a real estate transfer tax (tax on the sale of residential and commercial property) to raise money for open space acquisition and trail building.
  • The Pennsylvania and Florida state legislatures were among the first to create state funding programs for trail building and open space preservation. Much of the funding is available for local community-sponsored projects. Funds are also used for projects of statewide interest.
  • The Massachusetts Department of Environmental Management (DEM) runs a Greenways and Trails Small Grants Program to award small amounts of funding to local communities with innovative greenway and trail protection projects.


There are many examples of local communities creating revenue streams to improve conditions for bicycling and walking. Three common approaches include: special bond issues, dedications of a portion of local sales taxes or a voter-approved sales tax increase, and use of the annual capital improvement budgets of Public Works and/or Parks agencies.

Some examples follow:

  • The City of Albuquerque, New Mexico, and Bernalillo County, have a 5 percent set-aside of street bond funds which go to trails and bikeways. For the City, this has amounted to approximately $1.2 million every two years. City voters last year passed a 1/4 cent gross receipts tax for transportation which includes approximately $1 million per year for the next ten years for trail development. Many on-street facilities are developed as a part of other road projects.
  • Pinellas County, Florida built much of the Pinellas Trail system with a portion of a one cent sales tax increase voted for by county residents.
  • Seattle, Washington approved a nine year levy (property tax) in the fall of 2006 that provides five million dollars a year for bicycle and pedestrian projects.
  • Denver, Colorado invested $5 million in its emerging trail network with a bond issue, which also funded the city's bike planner for a number of years.
  • Eagle County, Colorado (which includes Vail) voters passed a transportation tax that earmarks 10 percent for trails, about $300,000 a year.
  • In Colorado Springs, Colorado, 20 percent of the new open space sales tax is designated for trail acquisition and development; about $5-6 million per year.