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Title 23, HighwaysRelease 119-110

§505 State Planning and Research

Title 23 › CHAPTER 5 — RESEARCH, TECHNOLOGY, AND EDUCATION › § 505

Last updated Sep 22, 2026|Official source

Summary

States must set aside 2% of certain federal transportation funds apportioned to them for fiscal year 1998 and every year after. Working with the Secretary, those 2% funds can only be used for planning, studies, research, and related work. That includes engineering and economic studies; planning future highways and local public transit and how to pay for them (including metropolitan and statewide planning under sections 134 and 135); building and running management systems under sections 119, 148, 149, and 167; studying the economy, safety, convenience, regulation, and taxation of surface transportation; research, development, and technology transfer for planning, design, construction, management, maintenance, and intermodal systems; work on engineering standards, materials, testing, inspection accreditation, and training; and planning for real-time monitoring. At least 25% of those set-aside funds must be spent on research, development, and technology transfer for highways, public transit, and intermodal systems. The Secretary may waive that 25% rule if a State certifies it will spend more than 75% of the funds described in paragraph (1) on planning under sections 134 and 135 and the Secretary accepts the certification. Money spent under the 25% rule and the share required for fiscal years 2013 and 2014 (as agreed by three-quarters of the States for section 503(c)(2)(C)) is not counted as the agency’s extramural budget under section 9 of the Small Business Act (15 U.S.C. 638). The federal share for projects using these funds is 80%, unless the Secretary decides to reduce or remove the State’s share. The Secretary pools these funds into one account and manages them; they can be obligated for the time period in section 118(b).

Full Legal Text

Title 23, §505

Highways, Source: USLM XML via OLRC

(a)General Rule.—
Two percent of the sums apportioned to a State for fiscal year 1998 and each fiscal year thereafter under paragraphs (1) through (5) of section 104(b) shall be available for expenditure by the State, in consultation with the Secretary, only for the following purposes:
(1)Engineering and economic surveys and investigations.
(2)The planning of future highway programs and local public transportation systems and the planning of the financing of such programs and systems, including metropolitan and statewide planning under section 134 and 135.
(3)Development and implementation of management systems, plans, and processes under section 119, 148, 149, and 167.
(4)Studies of the economy, safety, and convenience of surface transportation systems and the desirable regulation and equitable taxation of such systems.
(5)Research, development, and technology transfer activities necessary in connection with the planning, design, construction, management, and maintenance of highway, public transportation, and intermodal transportation systems.
(6)Study, research, and training on the engineering standards and construction materials for transportation systems described in paragraph (5), including the evaluation and accreditation of inspection and testing and the regulation and taxation of their use.
(7)The conduct of activities relating to the planning of real-time monitoring elements.
(b)Minimum Expenditures on Research, Development, and Technology Transfer Activities.—
(1)In general.—
Subject to paragraph (2), not less than 25 percent of the funds subject to subsection (a) that are apportioned to a State for a fiscal year shall be expended by the State for research, development, and technology transfer activities described in subsection (a), relating to highway, public transportation, and intermodal transportation systems.
(2)Waivers.—
The Secretary may waive the application of paragraph (1) with respect to a State for a fiscal year if the State certifies to the Secretary for the fiscal year that total expenditures by the State for transportation planning under section 134 and 135 will exceed 75 percent of the funds described in paragraph (1) and the Secretary accepts such certification.
(3)Nonapplicability of assessment.—
Funds expended under paragraph (1) shall not be considered to be part of the extramural budget of the agency for the purpose of section 9 of the Small Business Act (15 U.S.C. 638).
(c)Implementation of Future Strategic Highway Research Program Findings and Results.—
(1)Funds.—
A State shall make available to the Secretary to carry out section 503(c)(2)(C) a percentage of funds subject to subsection (a) that are apportioned to that State, that is agreed to by ¾ of States for each of fiscal years 2013 and 2014.
(2)Treatment of funds.—
Funds expended under paragraph (1) shall not be considered to be part of the extramural budget of the agency for the purpose of section 9 of the Small Business Act (15 U.S.C. 638).
(d)Federal Share.—
The Federal share of the cost of a project carried out using funds subject to subsection (a) shall be 80 percent unless the Secretary determines that the interests of the Federal-aid highway program would be best served by decreasing or eliminating the non-Federal share.
(e)Administration of Sums.—
Funds subject to subsection (a) shall be combined and administered by the Secretary as a single fund and shall be available for obligation for the period described in section 118(b).

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

A prior section 505, added Pub. L. 90–495, § 30, Aug. 23, 1968, 82 Stat. 831, related to highway relocation assistance payments, prior to repeal by Pub. L. 91–646, title II, § 220(a)(10), Jan. 2, 1971, 84 Stat. 1903.

Amendments

2015—Subsec. (a). Pub. L. 114–94 substituted “through (5)” for “through (4)” in introductory provisions. 2012—Subsec. (a). Pub. L. 112–141, § 52005(1)(A), substituted “paragraphs (1) through (4) of section 104(b)” for “section 104 (other than section 104(f) and 104(h)) and under section 144” in introductory provisions. Subsec. (a)(3). Pub. L. 112–141, § 52005(1)(B), substituted “, plans, and processes under section 119, 148, 149, and 167” for “under section 303”. Subsecs. (c), (d). Pub. L. 112–141, § 52005(2), (3), added subsec. (c) and redesignated former subsec. (c) as (d). Former subsec. (d) redesignated (e). Subsec. (e). Pub. L. 112–141, § 52005(2), (4), redesignated subsec. (d) as (e) and substituted “section 118(b)” for “section 118(b)(2)”. 2005—Subsec. (a)(7). Pub. L. 109–59, § 5205(1), added par. (7). Subsec. (d). Pub. L. 109–59, § 5205(2), substituted “for the period described in section 118(b)(2)” for “for the same period as funds apportioned under section 104(b)(1)”.

Statutory Notes and Related Subsidiaries

Effective Date

of 2015 AmendmentAmendment by Pub. L. 114–94 effective Oct. 1, 2015, see section 1003 of Pub. L. 114–94, set out as a note under section 5313 of Title 5, Government Organization and Employees.

Effective Date

of 2012 AmendmentAmendment by Pub. L. 112–141 effective Oct. 1, 2012, see section 3(a) of Pub. L. 112–141, set out as an Effective and Termination Dates of 2012 Amendment note under section 101 of this title. Alaska Highway Study Pub. L. 87–866, § 13, Oct. 23, 1962, 76 Stat. 1149, as amended by Pub. L. 97–449, § 2(a), Jan. 12, 1983, 96 Stat. 2439, provided that: “(a) The Secretary of Transportation, in cooperation with the State of Alaska, is hereby authorized to make engineering studies and estimates and planning surveys relative to a highway

Construction

program for the State of Alaska, and, in accordance with treaties or other agreements to be negotiated with Canada by the Secretary of State in consultation with the Secretary of Transportation, engineering studies, estimates, and planning surveys relative to connecting Alaskan roads with Canadian roads at the International boundary. “(b) On or before May 15, 1964, the Secretary of Transportation shall submit a report to the Congress which shall include—“(1) an analysis of the adequacy of the Federal-aid highway program to provide for a satisfactory program in both the populated and the undeveloped areas in Alaska; “(2) specific recommendations as to the

Construction

of roads through undeveloped areas of Alaska and connection of such roads with Canadian roads at the International boundary; and “(3) a feasible program for implementing such specific recommendations, including cost estimates, recommendations as to the sharing of cost responsibilities, and other pertinent matters. “(c) From time to time, either before or after submission of the report provided for in subsection (b) of this section, the Secretary of Transportation may submit recommendations to the Congress with respect to the

Construction

of particular highways to carry out the purposes of this section. “(d) Nothing in this section shall be construed as creating any obligation in the Congress, express or implied, to carry out the recommendations referred to in subsections (b) and (c). “(e) There is hereby authorized to be appropriated, out of any money in the Treasury not otherwise appropriated, to be available until expended, the sum of $800,000 for the purpose of making the studies, surveys, and report authorized by subsections (a) and (b) hereof.”

Reference

Citations & Metadata

Citation

23 U.S.C. § 505

Title 23, Highways

Last Updated

Sep 22, 2026

Release point: 119-110