# Whitmer announces first disbursement of Neighborhood Roads Fund

LANSING, Mich. — Governor Gretchen Whitmer on Monday said local agencies across the state are now receiving their first payments from the Neighborhood Roads Fund (NRF), a centerpiece of Michigan's new long-term road funding plan.

The NRF is part of a package that dedicates nearly $2 billion per year to rebuilding state and local roads, bridges, and transit, with built-in adjustments designed to keep pace with the state's evolving infrastructure needs.

Dedicated investments

The first disbursement will bolster existing road and bridge projects for counties, cities and villages. It also commits additional funding to specific efforts, including:

  • $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 local roads Michiganders drive on every day are getting a major investment," said state 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."

A new funding formula

The long-term road funding package protects funding for schools and other essential services while ensuring resources remain available for transportation and infrastructure. The plan draws from several sources:

  • $1 billion per fiscal year from a sales tax and motor fuel tax swap that began Jan. 1, 2026, dedicating all taxes paid at the pump to state and local roads without raising costs 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, protecting the general fund and providing a reliable base for transportation funding.
  • An additional $440 million phased in ($88 million annually) from corporate income tax growth to sustain long-term infrastructure investment.

"Fixing the roads means less wear on your car, a smoother drive, and safer travel for every Michigander," Whitmer said. "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 reactions

Local officials across the state said the funding would address long-standing gaps in neighborhood street investment.

"For too long, we have failed to invest in the local roads that all of us drive each day," said state Rep. Sam Steckloff (D-Farmington Hills), who sponsored the Neighborhood Roads Fund legislation.

"Streets are a huge part of cityscapes," said Grand Rapids Mayor David LaGrand. "This new funding will help us build the Grand Rapids of the future and help fund our vision of human-centered transportation and safer streets."

Marquette Mayor Paul Schloegel noted the city maintains nearly 90 miles of roadway in the Upper Peninsula and said the funding would help improve the roads residents rely on daily.

Broader infrastructure record

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

The administration also pointed to the Rebuilding Michigan Plan, a $3.5 billion plan expanding major road projects without a price increase at the pump, and a nearly $105 million competitive federal grant to replace I-375 in Detroit with a street-level boulevard.

More from Michigan Capitol

The disbursement is the first visible delivery of a funding plan that lawmakers passed as part of last year's budget and that took full effect with the Jan. 1 tax swap. State officials have said the program is designed to provide local governments with a stable, multi-year revenue stream rather than one-time appropriations.