Michigan OKs $3.5B in roads spending. Much of it is going to Metro Detroit.

Whitmer

Michigan Gov. Gretchen Whitmer, a Democrat, announced  $3.5 billion in bonds for state roads during her State of the State speech Wednesday, saying she was forced to borrow money because Republicans had no serious plans for fixing infrastructure. The GOP disagrees. (Bridge photo by Dale Young)

LANSING –  Michigan will nearly double its spending on state highways and bridges over the next five years under Gov. Gretchen Whitmer’s $3.5 billion bond initiative she announced Wednesday during her State of the State speech.

Nearly 40 percent of the new bond proceed spending will target reconstruction and rehabilitation efforts in Metro Detroit, including $764 million for Oakland County projects on Interstate 696, I-75 and I-96, $492 million for Wayne County projects on I-275, I-94 and M-14; and $126 million for Macomb County projects on I-94 and M-59.

All told, bond funding will be directed toward 49 reconstruction projects in 19 counties located in the bottom half of the Lower Peninsula, according to lists provided by MDOT. But transportation officials say the bond sales will free up funds to accelerate another 74 rehabilitation projects across 27 counties, including work as far north as Chippewa County.

“This is a statewide initiative,” Transportation Director Paul Ajegba told reporters after members of State Transportation Commission voted unanimously on Thursday to authorize the bond sales over four years. 

Those sales will allow the Michigan Department of Transportation to spend $7.3 billion on state highways and bridges over the next five years, up from $3.8 billion that had been planned.

 

House Speaker Lee Chatfield, R-Levering, called the bond plan “unfair” and said it reflects an ongoing hostility toward rural Michigan by the Whitmer administration. 

The Legislature has limited ability to prioritize where the bonding proceeds are spent, which should be a “concern for all taxpayers in Michigan,” said Senate Majority Leader Mike Shirkey, R-Clarklake. 

The department’s revised five-year plan includes investments in all regions of the state and generally reflects traffic volumes: Regions with more drivers will see more highway and bridge improvement projects.

The state plans to spend about $2.65 billion on projects in Metro Detroit through 2024. That would amount to roughly 36 percent of state trunkline spending over that span in a region where drivers logged 32 percent of all vehicle miles travelled last year, according to state figures. 

By comparison, the state will spend $225 million in the superior region, which includes all of the Upper Peninsula.

That’s about 3 percent of its statewide total in a region where roughly 4 percent of all vehicle miles were traveled.

“Southeast Michigan has the most population, and the governor wants to focus the spending on the most heavily travelled roadways with economic significance,” Ajegba said.

“The northern part of Michigan’s roads are fairly better than the southern part.”

If residents in rural areas want more road funding, Whitmer suggested they call their legislators and “tell them to get serious” about developing a long-term and comprehensive plan beyond highways. 

“This plan will improve roads in every part of the state,” she said in a Thursday morning media roundtable. 

“It’s not about one area or another. This is about managing an asset we all rely on, on which our economy relies to ensure that we don’t go so far and that we don’t recover.”

Whitmer compared the bonding plan to homeowner taking out a mortgage to build a new roof. 

“Sometimes for long-term investments, the wisest thing you can do is lock in a low interest rate and actually fix the problem,” she said. “And that’s where we are. That’s what we’re doing.”

A resolution approved by the transportation commission will allow the state to issue up to $3.5billion in bonds over the next four years.  The department will determine when to sell the bonds based on project needs.

Interest rates on a 25-year-bond are relatively low at between 2.5 percent and 3.5 percent, said Laura Mester, chief administrative officer of the Michigan Department of Transportation.

The department assumes that inflation would increase the cost of rebuild projects each year of inaction, she said, supporting Whitmer’s claim that bonding could save the state money in the long run.

“This is the perfect time to do a bond issue because we can get interest rates so cheap,” Commissioner Helen Zeerip said before the vote.

Five of the six members on the transportation commission were appointed by Republican former Gov. Rick Snyder, who warned against borrowing throughout his term. But in granting approval for bonding authority, several said they saw an immediate need to protect critical state assets.

Without more spending, Michigan roads “will go over a cliff, and it’s not recoverable,” said Chairman Todd Wyett, citing long-term pavement condition projections. 

“For four years we watched this state get nearer and nearer, and this is the first time that we’re going to take a step back from the cliff.” 

But Wyett called on Whitmer and the Legislature to continue work toward a long-term plan to  pay for infrastructure maintenance beyond the short-term bond funding influx. “The 10 million people who live in the state deserve it,” Wyett said.

State law does not allow the governor to unilaterally bond for local roads, which is why the new plan will only boost spending on state highways and bridges. The governor’s original proposal for a 45 cent fuel tax hike would have generated new revenue for state and local agencies. 

“She put a plan on the table,” Ajegba said. “There was no alternative plan. I would think now the onus is on the Legislature to come up with an alternative plan, and then both sides can get together to try to find a happy medium.”

State policy will prohibit MDOT from structuring the bonds in a way that requires debt service payments of more than $300 million per year. The state will spend about $118 million to pay down old road bonds this year, but most of that debt will be retired by 2027.

Mester said MDOT will make the new debt service payments using its only share of annual transportation tax revenue, which means the bonds will not reduce funding for local road agencies by shaving money off the top of the state’s traditional funding formula. 

“Not at all,” Ajegba said.

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Comments

Thom
Thu, 01/30/2020 - 8:35pm

How much of this highway money is going to the schools 10% 20% 30% ?

Joy Jackson
Tue, 02/04/2020 - 2:10pm

Can we Ben friends thom

R.L.
Fri, 01/31/2020 - 9:06am

I live in Alpena. We need road repairs also. Their was a pot hole, sink hole on our local street that was so big a family of 4 was living in it. They moved out it was too big for them. Sarcastic yes but we need help. Love to hear from you. R.L.

Dang Right
Fri, 01/31/2020 - 1:08pm

That's where it's needed the most and where most of the funds come from, but we still need to change the laws on heavy trucks. We also have to address rotting bridges and infrastructure all over the state!

Compromise
Fri, 01/31/2020 - 1:18pm

Maybe they should let roads turn to gravel and turn the ones left into toll roads in the districts of House Speaker Lee Chatfield, R-Levering and Senate Majority Leader Mike Shirkey, R-Clarklake. That way we can see how well those ideas work for the rest of the state and overall tourism! My guess is that those areas will be avoided by everyone.

Prof Ken Kolk
Sat, 02/01/2020 - 11:07pm

Even Gov Snyder’s (Republican) appointees to the State Transportation Commission can see that the Republican State Legislature has dragged their feet and played political games to keep our new Governor from delivering on her promise to “Fix the Damn Roads!” Our Republican Dominated Legislature know their Gerrymandered districts will assure they stay in power for at least two more years and if they can keep Gov. Whitmer from delivering on her promise they call run against that failure in 2022. They have had a year to work. Out a compromise and they haven’t made one proposal, they just keep saying no!

Amen
Mon, 02/03/2020 - 12:59pm

16 years of Republican legislature in Michigan and half of those with complete Republican control of the state. Yet they couldn't fix the roads, let alone bridges, water lines, etc. Now Calley was on the radio today complaining about what Whitmer is doing to fix the roads. Calley should be ashamed of himself. No credibility: He used to admonish Trump. Now he loves Trump.

Matt
Tue, 02/04/2020 - 1:34pm

Of course the 60/40 public opposition to her 45 cent gas tax had nothing to do with it.

Spring Break!
Tue, 02/04/2020 - 8:16am

Hey let's go to communist Cuba for Spring Break! I wish I could afford it, but I'm paying taxes for my legislators to go! Even though Trump put greater restrictions on trade with Cuba, according to the Free Press:

Senate Majority Leader Mike Shirkey and several other members of the Legislature flew to Cuba Monday and will not be in Lansing Thursday for the presentation of Gov. Gretchen Whitmer's second state budget, officials said.

Shirkey, R-Clarklake, joined Michigan Agriculture Department Director Gary McDowell and several other state lawmakers on a trade mission organized by the Michigan-Agri-Business Association. The delegation returns Saturday...

Also on the trip are Rep. Julie Alexander, R-Hanover, who chairs the House Agriculture Committee; Sen.Roger Victory, R-Georgetown Township; Sen. Dan Lauwers, R-Brockway; Sen.Tom Barrett, R-Charlotte; Rep. Brian Elder, D-Bay City, and Rep. Scott VanSingel, R-Grant.

Can't help but notice that they are almost all Republicans and it's winter in Michigan. They aren't going in the summer for some reason, when it's hot and there are hurricanes and it costs less and they would be on break and they could pay for their own trips...

Trump Republicans "L'état, c'est moi"! Let them eat cake!

Bon Voyage to our Overlords!

Andy Berg
Tue, 02/11/2020 - 3:07pm

Statewide problem my ass why should upper michigan pay for the roads in the Detroit metro area we have roads up here that need work also

Mark
Thu, 02/13/2020 - 9:22am

This states infrastructure was built on the revenue that came from Detroit’s factories. Maybe it’s time for the rest of the state to rebuild Detroit so it can again become the economic engine this state needs.

Wishful thinking
Thu, 02/13/2020 - 1:07pm

What about SOUTHWEST MICHIGAN and all others in need. Make sure the cost comes out of Detroit.