County, industry and municipal groups tell House committee Michigan needs new road funding now

County, industry and municipal leaders told the Michigan House Transportation and Infrastructure Committee on the record that local roads and bridges face persistent and growing funding shortfalls and that lawmakers should act to stabilize and increase road funding.

The presentations came from Denise Donahue, chief executive officer of the County Road Association of Michigan; Lance Biannini, vice president of government affairs at the Michigan Infrastructure and Transportation Association; and John LaMackie of the Michigan Municipal League. The committee met with a quorum present and accepted two routine motions (minutes adopted and a motion to excuse absent members) without recorded opposition.

Why it matters: presenters said local governments maintain the majority of Michigan’s road network but receive a minority share of transportation revenues. They argued that rising replacement costs, new regulatory requirements that convert culverts into bridges, and declining per-gallon fuel revenues driven by improved mileage and electrification are worsening the gap between needs and available funds.

Denise Donahue, County Road Association of Michigan

Denise Donahue told the committee that county road agencies manage roughly 90,000 centerline miles — “that’s 75% of the overall miles within the state of Michigan” — and more than 5,800 local bridges, about 52% of the state total. She described several county-level programs and needs: an electronic permitting platform called Oxcart used by 78 of 83 counties; a seasonal weight-restrictions mobile app with about 11,000 subscribers; a wetland mitigation program funded by a recurring $2 million deposit to a program capped at $8 million that buys or builds wetland credits counties can draw on; and a local road research program being seeded with federal and state matches and a project management platform called Road Conductor being developed at Michigan Tech.

Donahue and CRA staff emphasized two drivers of rising local costs: regulatory changes that require upsizing culverts (which then can legally be classified as bridges) and a sustained decline in gasoline gallons sold. “So when gas tax is 40% of what is going into the MTF, you can see it’s declining,” she said. CRA’s most recent investment plan, Donahue said, showed a $2.4 billion gap in unmet county needs as of early 2022; county federal-aid-eligible roads were at about 65% in good-or-fair condition versus a 90% goal, and non-federal-aid local roads were about 44% good-or-fair versus a 60% goal.

CRA representatives described a federal-aid buyout pilot that allowed counties to sell federal-aid eligibility in exchange for state funds (the association said $25 million in 2023 and $35 million in 2024 were phased in), but they told the committee the buyout was suspended in 2025 because MDOT lacked state revenue to continue the program.

Lance Biannini, Michigan Infrastructure and Transportation Association (MITA)

Lance Biannini told committee members MITA, which represents about 600 construction and infrastructure firms, that the statewide funding shortfall to reach and sustain a 90% good-or-fair condition for roads and bridges has been estimated at roughly $3.9 billion annually. He said Michigan’s per-capita investment in transportation is far below the national average, noted the effect of the federal Infrastructure Investment and Jobs Act (IIJA) through 2026, and warned of a “funding cliff” after those five-year federal increases expire.

Biannini highlighted contractor and workforce risks tied to a funding drop, saying an early MITA survey of members indicated potential loss of thousands of jobs in the next three years if funding falls. He also pointed to permitting barriers that limit local access to nearby aggregate (sand and gravel) as a contributor to higher project costs and suggested permitting reform and better access to aggregates as one way to control construction inflation.

John LaMackie, Michigan Municipal League

John LaMackie said cities and villages manage roughly 21,000 miles of roads and that municipalities receive about $734 million from the Michigan Transportation Fund under Act 51 (cities and villages bucket), plus other federal and local funding. LaMackie argued that much federal funding does not flow to neighborhood streets and urged dedicated local-targeted funding. The Municipal League proposed a neighborhood-roads fund financed by a 50¢ retail delivery fee modeled on other states; the League estimated the fee could generate roughly $275 million and recommended targeting about $250 million to avoid overly spreading funds thinly across more than 600 local road agencies.

Selected direct quotes from presenters (verbatim from the transcript):

“We have 90,000 miles of straight miles, excuse me, centerline miles of road. That’s 75% of the overall miles within the state of Michigan.” — Denise Donahue, County Road Association of Michigan.

“If $3,900,000,000, which is needed annually to get us to 90% good and fair condition for our roads and bridges were to pass, what your counties would see.” — Lance Biannini, Michigan Infrastructure and Transportation Association.

“We identified a funding source, a 50¢ retail delivery fee.” — John LaMackie, Michigan Municipal League.

Discussion highlights and staff clarifications

- CRA presenters described the wetland mitigation program as a mechanism to provide banks of mitigation credits to local agencies at no cost; CRA said private wetland credits can cost roughly $100,000 per acre on the open market and that the association’s purchases are provided to members at no charge. CRA said a recent purchase in Oakland County was 14.5 acres and that some purchased mitigation sites serve multi-county watersheds.

- CRA and MITA presenters quantified bridge need and the competitive nature of bridge grant cycles: presenters said MDOT received 401 applications for a 2027 bridge funding call that requested $515 million while approximately $80 million was available in the program year presented.

- MITA noted IIJA funds and a four-year state bonding program (Rebuilding Michigan) extend through 2026 and that policy choices are required now to avoid a post‑2026 funding cliff.

- Multiple committee members asked about how proposed programs would treat small businesses, emergency or disaster-driven local road damage, and equity between urban and rural users. CRA said a local disaster-relief program proposal had $5 million seed money in a prior budget but the account was not established and seed funds lapsed; CRA recommended reestablishing seed funds and creating an independent panel to administer a local disaster-relief program focused on local agencies rather than MDOT-level disasters.

Votes at a glance

- Adoption of minutes from the February 25 meeting: motion by Representative Alexander; no objection recorded; minutes adopted (committee reported 12 members present at roll call).

- Motion to excuse absent members: motion by Representative Preston; motion prevailed (no recorded objection).

What was not decided

Presenters provided program descriptions, cost estimates and policy options but did not present legislation to the committee during the hearing. No formal funding or policy changes were adopted in the meeting record.

Background and next steps

Testimony framed three recurring policy options: (1) redirect additional state revenue toward transportation (including proposals to direct sales tax on motor fuel to roads), (2) create targeted local funds for neighborhood streets, and (3) pursue administrative or permitting reforms to reduce project costs. Committee members said the committee will soon present its own road-funding plan for discussion.

Ending note

Presenters and committee members agreed that the state faces difficult choices about revenue, distribution and coordination across state, county and municipal systems. Several presenters urged quick legislative action to avoid losing contractor capacity and to arrest further deterioration of local roads and bridges.