NCDOT Funding Sources

NCDOT Sources of Funds Pie Chart 2015

NCDOT Funding Distribution

NCDOT Sources of Funds Pie Chart 2015

NCDOT Expenditures

NCDOT Budget Sources and_Uses 2015

North Carolina has a large and diverse transportation system consisting of all modes of transportation, including highways, rail, aviation, ferries, public transit and bicycle and pedestrian transportation.

With an annual operating budget of about $4.4 billion, the North Carolina Department of Transportation is responsible for building and maintaining this transportation network, as well as overseeing the state's Division of Motor Vehicles.

Transportation funding comprises approximately 80 percent state revenues and 20 percent federal.

State Funding Sources

Approximately 60 percent of state transportation funding is based on revenues from the Motor Fuel Tax; 25 percent comes from driver and vehicles fees collected by the North Carolina Division of Motor Vehicles; and 15 percent is from the Highway Use Tax on vehicle title transfers.

For more on the sources of these funds and how they are used, see the charts in the top right column of this page.

Motor Fuel Tax: : In March 2015, the North Carolina General Assembly established the following rates:

  • April 1, 2015 through Dec. 31, 2015: 36 cents per gallon
  • Jan. 1, 2016 through June 30, 2016: 35 cents per gallon
  • July 1, 2016 through Dec. 31, 2016: 34 cents per gallon
  • For the calendar year beginning on Jan. 1, 2017, the motor fuel tax rate is a flat rate of 34 cents per gallon, multiplied by a percentage.
  • Starting Jan. 1, 2018, the rate will change at the beginning of each year based on a statutory formula that takes into consideration population and energy cost inflation.

DMV Fees: The North Carolina General Assembly sets various fees collected primarily from licensed drivers and vehicle registration.

Highway Use Tax: The North Carolina General Assembly set the tax at 3 percent of a motor vehicle's net retail value (after trade-in allowance) when a certificate of title is issued in North Carolina.

Federal Funding

Appropriated by Congress, federal transportation funding comes from a federal motor fuel tax and vehicle fees (mostly on trucks). It accounts for approximately 20 percent of NCDOT's overall budget and about 45 percent of its construction budget.

Details about the current appropriations bill, commonly referred to as MAP-21, are available on the Federal Highway Administration website.

Funding Allocation and Distribution of State Funding

The three state revenue sources for transportation funding are allocated to two state funds as follows:

Highway Fund Strategic Transportation Investments
Motor Fuel Tax 71 percent 29 percent
DMV Fees Approx. 85 percent Approx. 15 percent
Highway Use Tax - 100 percent

Highway Fund: Primarily supports projects that help take care of the state's existing transportation system. This includes resurfacing highways, replacing bridges and paving unpaved secondary roads. Funds are distributed across North Carolina based on need.

The Highway Fund also supports the Powell Bill Program, which provides state aid to municipalities for pedestrian, bicycle and road improvements.

Strategic Transportation Investments: Primarily funds new construction and expansion projects across all modes of transportation. Funding is allocated on local, regional and statewide levels based on data and input from local planning organizations and NCDOT divisions.