LANSING, Mich. — The primary driver behind major road projects across Michigan is winding down.
The funding source for our state's "Rebuilding Michigan Program" is ending, and lawmakers are now negotiating on how to continue supporting road repairs across the state.
The program, approved in 2020, allowed the Michigan Department of Transportation (MDOT) to sell $3.5 billion in bonds to fund highway and bridge projects. Originally that funding was set to end in 2024, but a number of projects will continue through 2025.
Now, both Democrats and Republicans agree that continuing to fix roads is a priority, but the parties differ on specifics.
Michigan
Whitmer proposes $1.7 billion tax on corporations to fund road projects
Gov. Gretchen Whitmer's "MI Road Ahead" plan aims to pump $3 billion into road projects, with $1 billion of that money going to local street construction. She calls it a continuation of the progress made over the last four years.
"I'm proud of the work that we've done on key highways and bridges with my rebuilding Michigan bond plan, but we are facing a major funding cliff," Whitmer said during her Road Ahead Address back in January.
Whitmer's idea calls for an additional $250 million for public transit efforts, and says it won't impact the School Aid Fund.
Republican House Speaker Matt Hall's plan proposes $3.145 billion in funding, with nearly $2 billion going to local road projects.
"The plans that I'm putting forward now are to fix those local roads, the ones that make the biggest impact with the people that we represent," Hall said.
Both plans include $500 million in budget cuts and propose dedicating all taxes paid at the pump to road funding without raising costs for consumers.
The main difference lies in how the rest of the money is collected.
Whitmer's plan targets large companies like Facebook, Amazon and X to pay more, aiming to generate $1.7 billion in revenue. The governor claims large companies in the tech industry slip through the current Michigan tax law because it hasn't been updated to reflect the modern business environment. Her plan also calls to close a loophole exempting the marijuana industry from a wholesale tax, potentially raising $470 million.
Hall's plan suggests redirecting $2.2 billion from corporate income tax payments currently used for business incentives. That money would be divided separately from the other additional funding. Ten percent would go to state roads, 40% would be sent to cities and villages, and the remaining 50% would be provided to county road commissions.
"I'm saying we get there by taking the money from the corporations and prioritizing roads," Hall explained. "I see that we can get there without raising taxes."
Road funding proposals breakdown
Whitmer
- $3 billion in new funding for road projects
- $1 billion earmarked for construction projects on local roads
- An additional $250 million for public transit efforts across the state
- Redirect money collected through the sales tax at the pump to road construction
- Amend the state's tax code to collect $1.7 billion
- Make marijuana companies pay the wholesale tax, bringing in $470 million
Republicans
- $3.145 billion in new funding for road projects
- Exempt gas from sales tax, creating a new gas tax to replace it, with all money going to roads
- Redirect $2.2 billion collected through the corporate income tax
Both plans agree to $500 million in other budget cuts.
Lawmakers will need to reach a deal, draft legislation and pass it through both chambers before the governor can sign new road funding into law.
Governor Whitmer is set to give her 2025 State of the State address on Wednesday, Feb. 26, where we may also learn more about the road ahead.
This story was initially reported by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
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