Off-System Rail Grade Separation State Fund Program

Senate Bill 1555 (89th Texas State Legislature) established the Texas Off-System Rail Grade Separation State Fund Program, authorized under Transportation Code § 471.010. This program provides financial assistance to eligible governmental entities in Texas for rail grade separation projects that improve public safety, support economic development, and reduce traffic congestion. The Legislature allocated $250 million through a supplemental budget appropriation. The Department’s administrative rules governing implementation and administration of the Program are located at 43 TAC §§7.120 – 7.134 and become effective October 15, 2025.

Program overview

Webinar moved to October 28, 2025 at 10:00am. Additional details and webinar link will be posted to this page on October 24, 2025.

Funding is available for project development and construction of projects that eliminate one or more existing adjacent at-grade rail-highway crossings or provide a grade-separated pedestrian-rail crossing.

Project eligibility

To be eligible for funding under the program, a must:​

1. be for the construction of a grade separation structure that will either eliminate one or more adjacent at-grade rail-highway crossings or provide a grade separated pedestrian-rail crossing;​
2. be located off the state highway system (roadways that are not underTxDOT’s jurisdiction);
3. increase public safety, enhance economic development, or reduce traffic; and​
4. constitute a logical, self-contained unit of work that can be constructed as an independent project whether it is proposed as an independent project or as apart of a larger transportation project.

Program funding may be used for the following:

• Planning, detailed design activities including preparation of construction plans, environmental, right of way (ROW) acquisition, and utility adjustment
• Project construction

Eligible project sponsor

The project sponsor must be the political subdivision of the state (e.g., counties, cities, special districts, and school districts) that has jurisdiction over the project's location, authority to undertake the project, and authority to enter into an agreement with TxDOT.

2025 Call for Projects

TxDOT will hold a Call for Projects beginning November 2025. Through the Call for Projects, selected projects will be recommended to the Texas Transportation Commission for final approval and awards.

To assist project sponsors, TxDOT will host a webinar on October 28, 2025, to provide guidance on eligibility and the application process. The application will be web-based, submitted online through TxDOT’s Rail Division website.​ There is no limit to the number of applications that project sponsors can submit for this Program Call.

The application is designed to capture project details, enabling the committee to assess funding eligibility, challenges encountered by the community by the rail grade crossing, benefits created by the proposed project, and initial project readiness, including railroad coordination. Additional details, including, but not limited to, project complexity, project costs, letters of support, a conceptual layout or design plan if applicable, and ability to provide financial commitment toward the 10% non-State match will be collected through the application.

Call for project materials

• Transportation Code - 43 TAC §§7.120 – 7.134 (effective October 15, 2025)
• Application considerations and evaluation criteria