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Today’s Roads with Tomorrow’s Dollars: Using GARVEE Bonds to Finance Transportation Projects

David Warren and Robert Puentes

In an environment of fiscal austerity and rising mobility needs, states nationwide are
struggling to find the means to pay for transportation projects. Grant Anticipation Revenue
Vehicle (GARVEE) bonds provide an increasingly popular method of financing
highway and transit infrastructure. Pledged against future federal transportation grants,
GARVEEs themselves normally don’t require public votes nor increased gas taxes. However,
project savings through accelerated planning and construction should remain the
primary consideration for using GARVEEs rather than political expedience.

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