With increasing urbanization, highway engineers have the arduous task of managing rapidly deteriorating highway infrastructure facilities with limited funds. For most of the budget allocation models proposed in the literature, there is the assumption of “one” central source of funding which can be used to fund all the different categories of maintenance projects. For municipal agencies, this is rare; there are usually multiple funding categories with restrictions on the eligible projects that can be funded by the respective funding sources. This paper aims at addressing this gap in problem formulation. First, a bi-objective base case model is constructed as an integer linear program. The objectives of the proposed model include the maximization of the condition ratings of the highway network and the minimization of road user costs. Secondly, an alternate model is developed to account for the multiplicity of funding sources and project eligibility constraints of the respective funding categories. To provide a pragmatic construct, the models are implemented using a numerical case study representative of a subset highway network (of 50 pavement sections) in Texas. For both models, the impact of incorporating user costs and the constraints of funding sources are discussed. The findings from this study indicate that failing to account for multiple funding sources and their respective funding constraints in models leads to an overestimation of the projected network-wide pavement performance. This can lead to an increase in reactive maintenance needs and faster depletion of contingency funds.