What the End of Federal Highway Funding on September 30 Means for Your Commute

• Federal authority for the Infrastructure Investment and Jobs Act expires September 30, and Congress has not passed a full replacement bill or a clean short-term extension.
• Without action, formula highway, bridge and transit programs would fall to pre-2021 funding levels starting in the next fiscal year, a cut the Congressional Budget Office estimates at $166 billion over five years.
• A Senate proposal already on the table would extend basic program authority through December 11 but would not renew the advance funding guarantees behind programs like the Bridge Formula Program, leaving some road and bridge work in limbo regardless of what Congress does this month.

The Law That Pays for Most of America’s Road Work Runs Out This Month

Every five years, Congress has to reauthorize the federal law that funds most of the country’s highway, bridge, transit and road safety spending. The current version, the Infrastructure Investment and Jobs Act, was signed in 2021 and its program authority expires September 30, 2026. With weeks left before that deadline, House and Senate committees have not finished a full multi-year replacement bill, and lawmakers are now debating whether a short-term extension can hold federal transportation funding together while a longer bill gets written. For a driver who never thinks about federal legislation, the practical version of this story is simple: the money that repaves highways, fixes bridges and funds state DOT safety programs runs on a law that is about to expire, and what Congress does or does not do this month affects how quickly potholes get filled and bridges get repaired in every state for years afterward.

What Makes This Law’s Funding Different

The IIJA was structured differently from earlier highway bills in a way that makes this particular deadline more consequential than a typical reauthorization fight. Most federal transportation spending works through two standard channels: contract authority paid out of the Highway Trust Fund, and funding appropriated each year out of the government’s general fund. The IIJA added a third channel, called advance appropriations, that locked in guaranteed funding for dozens of specific programs across fiscal years 2022 through 2026. That structure gave state transportation departments five years of budget certainty for programs they could not get any other way, including the Bridge Formula Program, which has paid out $5.5 billion a year toward bridge repair and replacement, and the Safe Streets and Roads for All program, which funds local road safety projects nationwide. According to the Congressional Research Service, advance appropriations made up 15 percent of guaranteed highway, bridge, transit and safety funding under the law, and nearly all funding for passenger and freight rail programs came from that same advance-appropriated pool.

That detail is significant. A routine short-term extension of the IIJA’s basic authority would not automatically extend the advance appropriations piece, and the National Association of Counties has been direct in warning Congress about this gap. On August 8, the Senate Appropriations Committee advanced a proposal that would extend government funding, including many surface transportation program authorities, through December 11. But that bill would not extend the advance-appropriated funding under what’s known as Division J of the IIJA, meaning programs relying on that money would lose part or all of their funding regardless of whether lawmakers pass the December extension on time.

What Happens if Congress Does Nothing

If Congress lets the September 30 deadline pass without any action at all, federal highway and transit formula programs would revert to funding levels that predate the IIJA starting in the next fiscal year. The Congressional Budget Office projects that reversion would cut roughly $28 billion a year from IIJA-era funding levels, adding up to a $166 billion shortfall over the following five years. Most transportation policy analysts view that scenario as the least likely outcome, as a full funding lapse would immediately disrupt road and bridge projects already underway in every state, but it remains the default if lawmakers cannot agree on either a full reauthorization or a clean extension before the deadline. County governments, which rely on federal dollars for a large share of local road, bridge and safety project funding, have pushed Congress hard through August to avoid that outcome, sending letters to House and Senate leadership urging full funding levels be maintained in whatever extension or reauthorization passes.

The more likely near-term outcome, based on where negotiations stood in late August, is some version of a short extension paired with a partial funding gap. Under the Senate Appropriations Committee’s August proposal, basic program authorities would continue into December, buying time for a full replacement bill, but programs tied to advance appropriations would see funding lapse or shrink in the meantime. Which specific state road, bridge and transit projects get delayed or slowed depends on how heavily a given project relied on Division J funding relative to standard contract authority or annual appropriations, information that varies project by project and state by state.

What This Means for Drivers in Every State

Federal highway money flows to states through formula programs that pay for a large share of interstate maintenance, bridge repair, and local road safety work, so a funding disruption at the federal level shows up eventually as slower repaving schedules, delayed bridge repairs, and stalled safety improvements at the state and local level. States can and do front some transportation spending with their own gas tax and registration fee revenue, so a federal funding gap does not stop road work overnight. What it does is remove the federal share that many state transportation budgets are built around, forcing state DOTs to either delay planned projects, dip into reserves, or wait out the uncertainty before committing to new construction contracts. For a driver already frustrated by potholes and orange cones, a federal funding fight in Washington translates into a longer wait for the repairs a state DOT has already identified as necessary but cannot fully fund without its federal match.

Bridge repair is the clearest example of a program where the stakes are concrete rather than abstract. The Bridge Formula Program funds work on structurally deficient bridges nationwide, and its funding came entirely through the advance appropriations mechanism now at risk. A state with a bridge already flagged for repair could see that project’s federal funding share delayed if Congress extends basic IIJA authority without also renewing Division J funding, though the underlying need for the repair has not changed.

Why This Keeps Happening in Washington

This is not the first time a highway funding deadline has come down to the wire. Prior surface transportation bills have gone through short-term patches and last-minute extensions before, and the pattern tends to repeat: a full, multi-year reauthorization requires House and Senate committees to agree on funding formulas, program priorities and policy riders that can take longer to negotiate than the clock allows. What sets this deadline apart is the advance appropriations structure unique to the IIJA. Past highway bills did not carry a companion pot of guaranteed multi-year funding the way this one does, so a routine stopgap extension used to be a relatively clean fix. This time, a stopgap extension and a full funding renewal are not the same thing, which is why county governments and transportation advocates have pushed so hard through the summer for lawmakers to understand the difference before voting on any extension language.

What Happens Next

Key House and Senate committees have signaled that a short IIJA extension is likely necessary while a full replacement highway bill gets finished, and lawmakers on both sides have introduced bills, including the bipartisan BASICS Act and the BUILD America 250 Act, aimed at strengthening federal, state and local coordination on transportation funding going forward. None of those bills has passed both chambers as of early September. For drivers, the practical marker to watch is September 30 itself: whether Congress passes a clean extension that keeps full IIJA funding levels intact, a partial extension that leaves advance-appropriated programs like bridge repair short of money, or lets authority lapse entirely will shape how quickly road and bridge work moves in every state over the next year, regardless of which state a driver lives in or which roads they use every day.

Sources:

• National Association of Counties: IIJA authorities expire September 30
• National Association of Counties: Senate funding proposal would create transportation funding cliff for counties
• Congressional Research Service: Funding and Financing Highways and Public Transportation Under the IIJA