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Congress should repurpose transportation funds to intelligent transportation systems, in part by tying federal surface transportation funding to states’ actual improvements in transportation system performance.

Given intelligent transportation systems’ (ITS) ability to maximize the capacity of existing highway infrastructure, expanding funding for ITS is the optimal use of highway transportation funding. Yet states have significantly underinvested in ITS, preferring to fund traditional transportation investments such as new highway capacity. As one GAO study on the state of ITS deployment in the United States found, “unfortunately, information on benefits does not have a decisive impact on the final investment decisions made by state and local officials.” Repurposing transportation funds to ITS systems that have a far greater cost-benefit return would spur innovation and improve performance of the transportation system. If the federal government tied federal surface transportation funding to states’ actual improvements in transportation system performance, it would encourage states to deploy the intelligent transportation systems delivering the greatest bang for the buck.