Vermont Agency of Transportation proposes roughly $883–885 million fiscal 2026 budget; paving funding falls

Secretary Joe Flynn of the Vermont Agency of Transportation told the House Transportation Committee on Jan. 29 that the governor's recommended fiscal 2026 budget for the agency is roughly $883 million, driven by federal grants, state transportation fund receipts and targeted program lines.

The recommended budget “depicts an $883,400,000 budget for the agency of transportation,” Flynn said, noting the total includes all VTrans operations and the Department of Motor Vehicles. Flynn emphasized the agency used far less one‑time money in the FY26 proposal than in FY25: "when we built the fiscal 25 budget, we used $46,000,000 of 1 time money... when we built this fiscal 26 budget... we've used only $12,500,000 of 1 time money."

Why it matters: the presentation frames a budget that keeps major programs funded while responding to higher project prices and constrained discretionary state revenue. Committee members pressed agency leaders about where revenue increases landed and why the paving line dropped, because pavement is a visible daily concern for motorists and municipalities.

Most revenue from federal highway programs, state transportation fund

Flynn and Chief Financial Officer Candace Almquist explained the budget mix: the single largest revenue contributor is Federal Highway Administration funds, followed by the state transportation fund (mostly DMV receipts such as fuel taxes, registrations and license fees), other federal sources (Federal Transit, Aviation, Railroad and Highway Safety programs) and smaller buckets such as local matches and interdepartmental transfers. Flynn noted the FY26 consensus forecast produced a modest net increase in TIB and transportation fund revenue—about $4 million—driven largely by DMV fee collections, while fuel revenues remain “tracking slightly soft.”

Almquist said the FY25 picture was distorted by one‑time items: "that $46,000,000 was comprised of a 1 time…