Transportation Funding Programs

Local Funding

Partnership Program

Hays County’s newest method of funding transportation improvements is a Partnership model between the County and the Texas Department of Transportation. The County is using project development and construction savings from its Priority Road Bond (originally funded with General Obligation bonds approved by voters in 2008) and Pass-Through Financing Programs (originally funded with Pass-Through Revenue bonds approved by voters in 2008) along with a $40 million construction funding commitment from TxDOT to fund this new program. 

Pass-Through Financing

Pass-Through Financing was authorized by the Texas Legislature in 2003 to address limited funding available for transportation infrastructure and to expand the partnership opportunities for local entities to accelerate improvements. Local entities could pay upfront for approved projects and then be reimbursed by TxDOT once projects were open to traffic. Reimbursement is based on the number of vehicles using the road within a set period of time. While the Pass-Through Finance Program is now uniformly administered, Hays County – an early adopter – was able to negotiate a quarterly reimbursement schedule rather than the now standard annual reimbursement schedule. This will result in the County securing repayment more quickly and reducing project financing costs.  For more information on TxDOT’s Pass-Through Finance Program, visit

Transportation Reinvestment Zones (TRZs)

Transportation Reinvestment Zones are a relatively new method of financing transportation improvements by using incremental increases – not a new or added tax – in property tax revenue in a designated zone to improve transportation in the area that will benefit most from the improvements. Hays County’s first TRZ (some 29 square miles) will be used, in conjunction with the City of San Marcos’ first TRZ, to repay TxDOT for approximately $48 million in upfront construction costs along the two-mile FM 110 extension. The TRZ has no direct impact on ad valorem tax rates on property located within it. For more information on TRZs, visit

State Funding

Proposition 12

In 2007 the Texas Legislature authorized and voters subsequently approved $5 billion in general obligation bond financing for transportation improvements in Texas. A second $3 billion, approved for distribution by the Texas Transportation Commission in 2011, included funding for projects in Buda, Kyle and San Marcos. Bridges along IH-35 at FM 150/Center Street, FM 1626/Kyle Parkway, County Road 132/Robert S. Light and FM 2001 all received Proposition 12 funding. For more information on Proposition 12 funding, visit

Federal Funding

American Recovery and Reinvestment Act (ARRA)

Congress authorized the American Recovery and Reinvestment Act (ARRA) in 2009 as a stimulus package for saving jobs and creating new ones, as well as stimulating economic activity. Transportation infrastructure investment was among the initiatives funded to achieve the goals of ARRA. The Hays County area received more than $18.6 million for improvements such as the Main Street bridge in Buda, completing the Cement Plant Road Overpass, adding a center lane to RR 12, restriping Spring Branch Road for a bicycle lane, and repairs and resurfacing to FM 2439, FM 621, SH 123 and Centerpoint Road. For more information on ARRA, visit