LANSING, Mich. -- Governor Gretchen Whitmer announced Monday that local agencies across Michigan are receiving their first payments from the Neighborhood Roads Fund, the local-government pillar of the state's new long-term road funding plan that dedicates nearly $2 billion a year to state and local roads, bridges, and transit.

The disbursement marks the first flow of money from a fund that was created to give counties, cities, and villages a reliable source of state dollars for the neighborhood streets they maintain. The release also commits additional targeted funding to specific local transportation projects.

What the funding covers

The first disbursement will help bolster existing road and bridge projects for counties, cities, and villages across the state. It also sets aside dedicated money for three categories of local projects:

  • $100 million to repair and replace local bridges
  • $100 million for public transit, including new transformational projects and local bus operations
  • $40 million for rail grade separation projects to improve safety and reduce traffic congestion

The state published a funding breakdown for Michigan cities and villages and a separate breakdown for counties so local officials can see the amounts allocated to each jurisdiction.

A new funding formula

The Neighborhood Roads Fund is one piece of a broader road funding package that is designed to be sustainable and that is paired with protections for schools and other essential services. The overall plan draws on several sources:

  • $1 billion per fiscal year from a sales tax and motor fuel tax swap that took effect on Jan. 1, 2026, which dedicates all taxes paid at the pump to state and local roads without raising the cost for motorists
  • $420 million to roads from revenue generated by a tax on the marijuana industry
  • $600 million shifted from the Individual Income Tax to the Corporate Income Tax to protect the general fund and provide a reliable base for transportation funding
  • An additional $440 million, or $88 million annually, phased in from corporate income tax growth to sustain the investments long term

"Fixing the damn roads means less wear on your car, a smoother drive, and safer travel for every Michigander," Whitmer said. "I ran on fixing the damn roads, and I am proud to keep my promise and get it done with last year's balanced, bipartisan budget. We're making a historic investment of nearly $2 billion to fix state and local roads, creating tens of thousands of good-paying jobs and lowering costs for drivers across Michigan."

Local officials weigh in

Elected officials from both parties and across the state praised the disbursement.

"The local roads Michiganders drive on everyday are getting a major investment," said Sen. Veronica Klinefelt (D-Eastpointe). "With nearly $2 billion in new funding, we're giving communities across Michigan the resources they need to transform their pothole-ridden roads into safer, smoother paths for folks to get around, all while creating thousands of good-paying jobs along the way."

"For too long, we have failed to invest in the local roads that all of us drive each day," said Rep. Sam Steckloff (D-Farmington Hills). "The Neighborhood Roads Fund fixes this long-standing problem faced by communities across Michigan and invests millions into fixing potholes and repairing bridges."

Lansing Mayor Andy Schor said the funding answers a long-running request from local governments for more state money for neighborhood streets.

"Governor Whitmer worked with the legislature to get that done and deliver funding we need to fix our aging infrastructure," Schor said. "Lansing and other cities across Michigan rely on the state to provide road dollars, and with these additional funds we can finally fix more of your damn neighborhood streets."

The announcement drew similar remarks from leaders in Marquette, where Mayor Paul Schloegel said the city maintains nearly 90 miles of roadway through the Upper Peninsula's challenging weather conditions; Genesee County Treasurer Sam Muna; Kent County Road Commission Managing Director Jerry Byrne, who said the additional revenue allows the commission to advance bridge and road improvements at a scale previously beyond its resources; and Grand Rapids Mayor David LaGrand.

A longer record

Whitmer's office said that since she took office through the end of this year's construction season, the state will have repaired more than 24,500 lane miles of road and 1,900 bridges, supporting more than 188,000 good-paying jobs. The state says the last seven years of balanced, bipartisan budgets have invested more than $31 billion to fix roads and bridges, more than the previous eight years combined.

The Neighborhood Roads Fund disbursement is the first concrete delivery of the local-government portion of the road funding package, and it sets up a recurring flow of state dollars to local road and bridge projects in the years ahead.