Federal 'Complete Streets' Act Mandates 5% Highway Fund Shift to Boost Bike Lanes, Sidewalks, and Transit Access

The new Complete Streets Act of 2025 is looking to fundamentally change how we design and fund our roads. Simply put, this federal legislation mandates that when we build or rebuild public roads, they must safely accommodate everyone: drivers, yes, but also pedestrians, cyclists, bus riders, and people using wheelchairs or other mobility devices. This isn't just a suggestion; it comes with a mandatory funding mechanism and strict new design standards.

The Mandatory 5% Fund Shift

Here’s the first real-world kicker: To make this happen, the bill requires states to commit 5% of their existing federal highway funds to run these new Complete Streets programs (SEC. 2). This is a big deal because it means states can’t just use new money; they have to divert a chunk of their current budget—money that might have been earmarked for traditional highway expansion or maintenance—into this new, multimodal safety program. If you’re a state DOT, you’re now juggling priorities, and if you’re a driver, you might see some traditional road projects slow down as funds are redirected to build out bike lanes, better crosswalks, and safer bus stops.

How Local Communities Get Involved

This is a state-administered program, but the action happens locally. Cities, regional planning groups, and transit agencies (called 'Eligible Entities') can apply for technical help and, eventually, construction grants. But first, they have to get serious. To qualify for federal grant money, a local entity must adopt a Complete Streets Policy (SEC. 2). This policy must detail exactly how they plan to design roads for all users, update their engineering manuals, and, crucially, address how they will serve underserved communities—think low-income areas and communities of color—to ensure they get fair access to jobs and services.

To get construction money, a city needs a Prioritization Plan that lists specific projects, costs, and timelines. States are instructed to prioritize projects at intersections and corridors where non-motorized users are most vulnerable, based on crash data. For a local government, this means that if you want a slice of that federal grant money (up to $20 million per project), you need to have a detailed plan ready to go, demonstrating how you’re improving safety for walkers and bikers.

New Design Standards Are Coming

Within 180 days of enactment, the Secretary of Transportation must create specific Complete Streets design standards (SEC. 4). This means dedicated, protected bike lanes will become the norm, with the level of protection increasing based on traffic speed and volume. Sidewalks, crosswalks, lighting, and traffic signals must also be updated to meet the latest accessibility guidelines. Starting two years after the law passes, any new or reconstructed federally funded highway project in an urban area costing over $10 million must follow these new standards. This puts serious teeth into the idea that safety for all users must be baked into the design from the start.

The Fine Print: Exemptions and Challenges

While the goal is universal safety, the bill does allow for some exemptions (SEC. 2). Projects don't have to comply if they are on a limited access highway (like an interstate), or if an area is so sparsely populated that few vulnerable users are expected. They can also be exempt if compliance would be “excessively expensive compared to the need or crash history.” This last part is a bit vague and gives state and local officials some wiggle room. If a city wants to skip adding a sidewalk to a road, they might argue the cost is too high relative to the number of people who walk there, or the lack of reported accidents. This subjective language could be a point of friction, potentially allowing some projects to sidestep the safety mandates.

Overall, this Act is a major push to modernize our transportation infrastructure, shifting the focus from moving cars quickly to moving people safely and efficiently, regardless of how they travel. It forces states to prioritize safety for vulnerable users and incentivizes local planning that connects communities, but it does so by requiring a significant reallocation of existing highway funds.