Rethinking How the U.S. Department of Transportation Is Organized
As a former senior official at the U.S. Department of Transportation (USDOT) and later a partner at McKinsey & Company, I’ve seen how organizational design can be a major contributor to performance. McKinsey’s research, and experience across both government and private industry, suggest that institutions organized around core functions rather than legacy programs often perform better. They adapt more easily, attract and develop the right expertise, and maintain clearer accountability for results.
USDOT’s structure was created in 1966, when highways, transit systems, airports, and railways operated largely as separate enterprises. Each had its own technologies, funding streams, and safety frameworks. That structure worked well for much of the twentieth century. But it no longer matches how transportation systems operate or how technology is rapidly reshaping them.
Two persistent challenges make it worth rethinking. First, the current organization has not delivered consistent improvement in the outcomes that matter most: safety, congestion, reliability, and the efficiency of infrastructure delivery. Despite substantial investment and many reform efforts, projects remain slow and expensive, and national safety trends have stagnated.
Second, the Department is not well structured to manage the accelerating integration of digital and data-driven technologies into transportation. Artificial intelligence, automation, and connectivity are advancing at different speeds across modes, but the overall pace is quickening. What once seemed distant is now arriving in real systems and real products, pressing government to adapt more quickly. Meeting that challenge requires deeper functional expertise and more collaboration across disciplines than the current model emphasizes.
A more functionally organized USDOT could better align the Department with how the transportation system actually works today and where it is headed. The following four functional agencies would capture the vast majority of the Department’s statutory mission (for purposes of this discussion, the Air Traffic Control function is treated as entirely separate problem to solve).
- Project Delivery Accelerator (PDA)
The PDA could serve as a true national project accelerator. State, local and private sector partners spend significant time navigating complex federal processes that emphasize compliance over outcomes. The PDA’s purpose would be to help project sponsors deliver faster and at lower cost by simplifying approvals, aligning funding and procurement rules, and embedding technical project experts to resolve issues early. Its success would be measured by realized timeline reduction (with targets of more than 50% of pre-construction time eliminated), more predictable outcomes, lower cost projects and better value for taxpayers. The focus would be on any roadway, airport, public transportation or passenger rail project that is receiving Federal funding assistance.
- Office of Transportation Safety and Innovation (OTSI)
Safety oversight and regulatory responsibility could be unified within one organization that brings together human-factors expertise, systems engineering, infrastructure experts, data analytics and forensic capabilities. As automation, new propulsion systems, and changing travel behavior reshape risk, safety regulation will need to be more adaptive and data-informed. OTSI could anticipate problems, share insights across transportation systems, and update standards based on evidence rather than relying primarily on prescriptive rules. The goal would be to look ahead for emerging safety risks and work with industry to develop improved approaches to mitigate those risks. The focus would be on passenger cars and trucks, commercial vehicles, freight railroads, airplanes and pipelines.
- Project Finance Bureau (PFB)
Infrastructure finance requires specialized capabilities. The PFB could bring together expertise in credit programs, value capture, and public-private partnerships to make federal dollars go further. Many transportation assets remain under-capitalized or priced in ways that understate long-term costs. A dedicated finance bureau could work with states, local governments, and investors to design sustainable financing models and manage federal exposure more strategically. The Build America Bureau is already largely playing this function, but the asset classes would include highways, transit systems, airports and seaports. The PFB’s tools would include a variety of credit products. Other non-organizational changes related to budget authority and scoring would likely be needed as well but is not within the scope of an organizational discussion.
- Emerging Transportation Technologies Research Administration (ETTRA)
ETTRA could coordinate research, standards, and deployment strategies for technologies such as automation, vehicle-to-everything communication, and advanced materials. It would connect engineers, technologists, and policy experts to bridge the gap between research and implementation, helping ensure that innovation strengthens rather than fragments the transportation system.
Each of these functions would require new kinds of expertise. Some of that talent exists within USDOT today, but others of it would need to be developed or recruited. A functional structure could attract professionals from engineering, finance, technology, and research organizations that historically have had limited interaction with the federal transportation workforce. That infusion of skill could help the Department keep pace with rapid technological change and the new forms of collaboration it demands.
The Department could manage itself through a concise business plan rather than an expansive strategic plan. A limited set of objectives and key results could guide decisions and track progress on safety, project delivery, and capital investment. Regular performance reviews between functional leaders and the Office of the Secretary could replace process-oriented oversight with a more disciplined, results-based rhythm.
Transitioning to this kind of model would be complex, but not impossible. The Department could begin with a limited pilot to test whether a functional approach improves performance. Air traffic control would remain separate, but aviation safety, airport investment, and related research could fit naturally within this framework.
This is not a proposal for immediate reorganization, but a thought starter. The goal is to align Federal capabilities with the way transportation is evolving—helping the public and private partners who actually deliver projects while preparing for the technologies arriving faster every year. Transportation change is not overnight, but it is pressing and accelerating. The Department that oversees it could evolve in step: more focused, more functional, and better prepared for what comes next.
The views expressed above are those of the author and do not necessarily reflect the views of the Eno Center for Transportation.
