House Transportation reviews $883 million FY26 transportation budget; members press on TIB, maintenance and transit funding

The House Transportation Committee on Feb. 6 examined the governor’s fiscal year 2026 transportation budget, a proposal totaling $883 million across all funds and including roughly $331 million from the state transportation (T) fund and about $452 million in federal money, Joint Fiscal Office analyst Logan Moberry told the committee.

Moberry said the largest single program area is program development — primarily paving and capital projects — at about $411 million, of which roughly $308 million is federal funding. “If you’ll see $411,000,000, that’s almost half of everything in this budget,” Moberry said. He also walked members through maintenance, town highway programs, the internal service (central garage) fund and transfers the administration proposes, including a $12.5 million set‑aside for IIJA federal match.

Why it matters: Committee members pressed staff to clarify how fund types and prior bond activity constrain short‑term flexibility, and asked for historical comparisons to detect trends. That context matters because state, federal and locally matched dollars carry different eligibility rules, and many program obligations extend multiple years, limiting how quickly the legislature can re‑direct spending.

Committee discussion and key details Members repeatedly asked how the Transportation Infrastructure Bond (TIB) fund is being used when the state has no outstanding bonds. Moberry explained the TIB fund is a dedicated revenue stream intended to pay debt service if bonds are issued; because there currently are no outstanding bonds, the administration proposes to appropriate the TIB revenues for long‑lived capital projects instead, with a statutory caveat that TIB dollars be used for long‑term projects. “If we had TIB bonds, we would use the TIB money to pay for any debt servicing costs for those bonds. But since we don’t have any bonds, we appropriate it like T fund dollars with that caveat that it has to go to long term projects,” Moberry said.

Members and staff reviewed the state’s prior TIP bond history. Fiscal staff noted Vermont issued three series of TIP bonds (2009, roughly 2011, and 2013) totaling about $36 million at the time and that federal COVID relief funds were used to retire outstanding TIP bonds early, which freed up roughly $2.5 million per year in recurring TIB revenues to spend on projects on a pay‑as‑you‑go basis.

Moberry told the committee the governor’s recommended budget shows a small net change compared with last year: total program development is down about $9 million (2.2%), driven in part by a $27 million decrease in paving lines, while the overall total of AOT programs is essentially flat (less than 1% increase). He flagged a forecasted revenue downgrade that the administration proposes to address with a $2.3 million transfer this session to align TIB appropriations with expected receipts.

Committee members sought a clearer historical view of appropriations. Several asked staff to provide multi‑year line‑by‑line comparisons (4–5 years) showing which programs have grown, fallen or remained level and to separate personnel costs (pay, health care) from project spending. Moberry said the white book and the agency’s project lists provide itemized project detail and that fiscal staff can prepare a historical spreadsheet on request.

Other program notes and numbers cited in committee discussion - Total all‑funds budget: $883,000,000 (Moberry). - T fund (state transportation fund) shown in the presentation: about $331,000,000. Federal funding shown: roughly $452,000,000. Local/other: about $24,000,000 (as presented by Moberry). - Program development (capital/paving): roughly $411,000,000 of which about $308,000,000 is federal. - Maintenance: about $117,000,000 total, of which $110,000,000 is state T fund dollars (Moberry: “almost all of that… is T fund dollars”). - Central garage (internal service fund): about $25.6 million (internal transfers from agency divisions pay the garage fees). - Pay act / pay‑related placeholder included in the operating request: $3,000,000 (up from about $2.5 million last year) as a budgetary estimate for pay pressure. - Transfer set‑aside for IIJA federal match: $12,500,000 (set aside in prior year for federal match use). - Stabilization reserve: statutory requirement to hold up to 5% of the prior year’s T fund appropriations; staff said it generally has been maintained near the 5% maximum and that the balance is roughly in the mid‑teens of millions (Moberry referenced $15–$18 million as a round figure for the fund balance during Q&A).

Discussion vs. decision Committee members debated whether the budget’s line items reflect legislative priorities or simply the constraints of available fund types and projects already in the statewide queue. Fiscal staff repeatedly cautioned that observed dollar shifts often reflect project timing and differing federal match rates rather than deliberate reprioritization. No formal committee actions or votes were taken during the hearing; members requested additional materials and follow‑up figures.

What members requested next Members asked staff to provide: - A 4–5 year historical comparison showing program line trends (maintenance, paving, town highway aids, public transit, rail, aviation) broken out by fund where possible. - A clearer separation of personnel (pay and benefits) vs. project dollars for major appropriations. - The agency’s planned project list tied to the white book pages for items that drove the year‑to‑year changes.

Ending Fiscal staff told the committee they will provide the requested comparative spreadsheets and project detail and that the committee will see agency witnesses and legislative counsel as the budget language and bill drafting move forward. The Committee recessed to hear guest testimony on transportation policy from outside witnesses.