Gary has a much better answer than the newspaper company did:
the federal government covers 80% of new highway construction while the state picks up the remaining 20%.
(Notice that ribbon cuttings are great photo opportunity for politicians)
The cost to maintain those roads, however, comes fully from state, county, and city budgets.
(Not many politicians in a pothole filling photo.) and fixing potholes is ALWAYS the low priority, despite being the highest concern/problem issue.
So the answer, as ALWAYS was to raise taxes to cover the inflation rate of getting things fixed, and we aren't likely to see any action for years to smooth the California interstates... and man, every day, here in San Diego, I spend 99% of my time on the interstates, the 163, the 8, the 805, the 15, the 52, the 94 and the 125. Yes, every day, I am on 3 or 4 of these to get across the city faster than ordinary roads... and the ordinary roads? Are often 3 or 4 lanes in each direction.... I kid you not. Big city, huge amount of traffic.
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