Updated at 4:01 p.m. on February 10, 25.
In her latest attempt to fix the roads, Governor Gretchen Whitmer revealed her $3 billion MI Road Ahead Plan on Monday. This was her campaign pledge during her first run for governor in 2018.
Whitmer’s office praised the initiative as sustainable, balanced, and fiscally responsible. They suggested increasing funding for road repairs in Michigan by ensuring that gas tax revenue is used for road repairs, reducing expenses within the state budget, closing a marijuana tax loophole, and requiring corporations to pay their fair share for using Michigan roads.
In a statement sent to the Michigan Advance, Whitmer stated, “I’ve been focused on fixing the damn roads since day one, and while I’m proud of the progress we’ve made, there’s still a lot more to do.”
Hall outlines a $3.1 billion plan to fund roads by rerouting gas taxes and eliminating MEGA credits.
To assist more Michiganders stay safe on the road, save money, and get where they’re going faster, I’m thrilled to present my brand-new proposal today, which offers a long-term, sustainable solution to rebuild our roads, said Whitmer. In order to reduce costs for families, my approach is balanced and fiscally reasonable, combining cutbacks and new revenue. I appreciate Speaker Hall expressing this goal, and I’m excited to collaborate with him and the legislature’s two parties to see this through to completion.
The GOP-controlled Legislature rejected Whitmer’s proposal to raise the gas tax in 2019, and it was never implemented.
Road financing has been a primary priority for Republicans. On January 16, House Republicans and Michigan House Speaker Matt Hall (Richland Twp.) unveiled their most recent road funding plan.
Whitmer’s plan allocates $3 billion for road financing, of which $1 billion is specifically allocated for local road improvements. Additionally, $250 million would be used to subsidize local bus services and the construction of new transit projects throughout the state.
Although Michigan residents already pay a 6% state sales tax on each gallon of petrol in addition to federal and state gas taxes, 25% of those revenues are diverted from road repairs. With $1.2 billion for roads, bridges, and transit, Whitmer’s plan would fill that financial need.
By closing a loophole that exempts the marijuana sector from the wholesale tax imposed on other goods like cigarettes and tobacco, her plan also seeks to raise an extra $470 million.
The governor wants to raise an additional $1.6 billion from big businesses and digital giants like Amazon, Meta, and TikTok by asking them to pay their fair part for doing business in Michigan, in addition to the $500 million in budget cuts.
The details of this plan remain subject to negotiation, according to a spokesman from Whitmer’s office who informed the Michigan Advance that they hope to collaborate with Hall and Senate Majority Leader Winnie Brinks (D-Grand Rapids) on a final version.
Without increasing taxes, Hall’s 2025 road funding plan would allocate $3.145 billion for highways.
Hall’s plan, like Whitmer’s, intends to raise $945 million by directing all gas station fees toward road construction. A revenue-neutral motor fuel tax that goes exclusively toward roads would take the place of the gas sales tax. According to a press statement, drivers won’t notice a difference, but roads will get additional funding for repairs.
$2.2 billion from the corporate income tax would provide the majority of the funding. By removing $500 million in previous tax advantages offered by the Michigan Economic Growth Authority, which was disbanded in 2012, it will free up more money.
Additionally, it would stop a $500 million automatic deposit into the State’s Strategic Outreach and Attraction Reserve Fund and free up $500 million by prohibiting spending on legislative special projects. Future deposits would be subject to parliamentary approval based on their merits and on an individual basis.
It reserves $100 million that was previously allotted to two expiring corporate placemaking and community development funds, in addition to an additional $600 million in ongoing general funds from higher-than-expected tax returns predicted by the state’s consensus revenue forecasting conference.
I’m glad Governor Whitmer has joined the discussion on this matter, and I’m looking forward to collaborating with him to make sure Michigan drivers have access to the dependable, safe roadways they deserve. In a statement on Monday afternoon, Hall stated that one of the first things he brought up after winning the House Speakership was road financing.
Since Governor Whitmer took office, government expenditure has increased by 43%, but our local roads still need to be fixed. Families in Michigan demand results, which is why our proposal emphasizes practical solutions. These include fixing local roads first, maximizing the use of our present budget rather than enacting additional taxes, and giving money for roads priority over corporate earmarks. “We have to get this right because roads and infrastructure are crucial,” Hall stated.
The Michigan Infrastructure and Transportation Association, which represents several heavy construction businesses and suppliers, called on policymakers to act to protect road construction jobs and presented two options.In 2025, Michigan will run out of money as the governor’s bonding program and the increase in federal infrastructure financing run out. According to Rob Coppersmith, executive vice president of the association, the state already has a $3.9 billion infrastructure investment shortfall that is growing as maintenance requirements and inflation rise.
The time has come for Michigan’s leaders to unite and complete the task. Waiting any longer is not an option for Michigan. According to Coppersmith, we anticipate swift action in Lansing on a sustainable, egalitarian, and long-term infrastructure plan that saves thousands of jobs and puts Michigan back on course.
John Dulmes, executive director of the Michigan Public Transit Association, praised the plan.
Dulmes praised Governor Whitmer’s plan to upgrade public transportation and other aspects of our state’s transportation system. In addition to addressing the current financial problems that local bus systems are facing, this strategy helps open the door for more reliable services and the creation of new transit projects in our state to satisfy the state’s expanding demand. In order to finance solutions for our whole transportation system, we urge the Governor and the Legislature to step up their efforts.
Representatives of a number of local bus networks have expressed concern about a budget issue, predicting that additional funding of $200 million a year would be required to fully sustain the system, according to a news release.
But Whitmer’s plan was criticized by Senate Minority Leader Aric Nesbitt (R-Porter Twp.).
In addition to raising the gas tax by 45 cents and using her power to rack up $3.5 billion on the state’s credit card, Governor Whitmer has failed to present a genuine plan to restore Michigan’s roads for six years because she refused to cooperate with the Legislature, Nesbitt added. She has already suggested imposing additional mileage-based charges on drivers in Michigan. She now seeks to delve farther into Michigan companies’ finances and levy vague taxes and fees that will undoubtedly trickle down to customers. In the end, her refusal to reduce unnecessary government spending means that she lacks a true plan.
Hall’s plan, according to Nesbitt, is commendable since it makes investments in our deteriorating infrastructure without requiring additional payments from Michigan’s suffering taxpayers.Working toward a viable road funding solution that doesn’t increase taxes on hardworking families and push up the already high cost of living is something I’m looking forward to. According to Nesbitt, Michiganders just cannot afford any more of Governor Whitmer’s failed tax-and-spend proposals.
Brinks described Whitmer’s plan as an honest assessment of the true expenses of rebuilding and repairing our roads in an email statement.
I think we can take this complex problem that has afflicted our state for decades and make it a significant bipartisan victory for all Michiganders. The governor, speaker, and I have all stated our intention to find a long-term, sustainable solution. Brinks uttered those words.
Additional remarks from legislators and transportation officials have been incorporated into this report.
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Eliot Pierce is a dedicated writer for ChiefsFocus.com, covering local crime and finance news. With a keen eye for detail and a passion for storytelling, Eliot aims to provide his readers with clear and insightful analysis, helping them navigate the complexities of their financial lives while staying informed about important local events. His commitment to delivering accurate and engaging content makes him a valuable resource for the community.