In a Nutshell:

• Michigan ranks 30th among all 50 states in road funding levels by an assessment of data from 2012 to 2021 and 40th in road system conditions using the latest available data.
• The performance of Michigan’s road program—the effectiveness in using available funding to maintain public roads—has declined between 2004 and 2024.
• Improving road conditions in Michigan will require more than just increasing funding. Policy solutions should focus on how money is spent. This includes revisiting the state’s pavement management strategies and replacing Michigan’s outdated road funding law, Public Act 51 of 1951.

This post provides a summary of Citizens Research Council of Michigan’s recent report, A Data-Driven Assessment of Michigan’s Road Program (hereafter referred to as the 2025 Michigan Road Program Report). The report offers a fact-based analysis to inform ongoing public policy discussions. One key conclusion: overall funding levels are just one factor affecting road quality—smarter spending and systemic reforms may be just as critical as additional revenue to maintain and improve infrastructure conditions statewide.

Michigan’s Road Program Funding

Most public discussions around highway infrastructure focus on the total state transportation budget, but not all of that funding is used for roads and bridges. The 2025 Michigan Road Program Report isolates funding that was specifically allocated to roads and bridges between 2004 and 2024, providing a more accurate picture.

A major challenge in assessing road funding over time is inflation. Traditional inflation measures like the Consumer Price Index (CPI) don’t reflect the true cost increases in road construction, which typically outpace general inflation. While the National Highway Construction Cost Index (NHCCI) offers a national average, it still doesn’t account for state-specific conditions.

Fortunately, Michigan is one of a handful of states that calculates state-specific road construction cost inflation. This report uses the Michigan Highway Construction Cost Index (MHCCI) to obtain an accurate estimate of changing construction costs in Michigan. An additional consideration is that construction is not the only cost in a road program. Other costs include administration, planning, engineering, permitting, and so on. These non-construction costs are also subject to inflation, but at a different rate than the MHCCI.

The Michigan Road Program Report provides a uniquely accurate estimate of Michigan’s road program purchasing power by adjusting nominal funding to a combination of MHCCI and regional CPI from 2004 to 2024 (Chart 1).

Chart 1
Michigan’s Nominal Road Budget and Purchasing Power in 2023 Inflation-adjusted Dollars, FY2004 – FY2024

In 2004, Michigan spent $2.6 billion on roads and bridges. This is worth about $5.0 billion in inflation-adjusted 2023 road funding dollars. From 2004 to 2016, Michigan’s nominal road funding remained nearly flat. By 2016, cost inflation reduced the purchasing power of Michigan’s road program to a low point of $3.8 billion, a nearly 25 percent reduction. 

In 2017, Michigan’s roads began receiving additional revenue from the 2015 road funding package. Also, beginning in 2020 the Rebuilding Michigan Program contributed additional funding through bond financing. Concurrently, federal funding increased with the 2021 federal Bipartisan Infrastructure Law. As a result, Michigan’s road funding more than doubled between 2016 and 2024 in nominal terms. While uniquely high construction cost inflation during this period undercut the purchasing power gains, Michigan’s road program was better funded in 2024 than at any time in the previous 20 years.

This report also provides a separate assessment of Michigan’s road program funding compared to other states. A state-by-state Road Funding Index was created using a combination of data from federal sources, evaluated for the period from 2012 to 2021. Michigan ranks as the 30th most well-funded state for road funding over this decade.

This analysis shows that Michigan’s roads have been slightly less funded than the average state from 2012 to 2021. However, Michigan road funding hit a two-decade high-water mark as of 2024.

Michigan’s Road System Conditions

The 2025 Michigan Road Program Report provides an overview of what is known about the conditions of the state’s road infrastructure from 2004 to the most recent data, including a cross-state comparison to other states.

Evaluating road system condition is difficult because there are multiple relevant metrics to evaluate pavement conditions, and data is unavailable for much of the public road network. In Michigan, discussions of pavement conditions typically utilize data provided by the Transportation Asset Management Council (TAMC). TAMC works with Michigan’s road agencies to collect and report pavement condition data on federal-aid eligible (FAE) roads, which includes 33 percent of the state’s public road network by system mile (Chart 2).

Chart 2
MI-PASER Ratings of Michigan’s FAE Network by Lane-mile, 2004 – 2023

MI-PASER is collected by road agency staff via “windshield survey.” MI-PASER raters drive the road and record a score between 1 and 10. MI-PASER raters receive training and are provided advice on how to interpret pavement distresses into a rating. The benefit of MI-PASER is that it can be collected inexpensively by non-engineers, but a key drawback  is that it is not an objective engineering-quality metric. It is a largely subjective metric, potentially influenced by different interpretations of pavement conditions and various human biases.

The MI-PASER rating is a modified version of a rating system introduced in 1987 to provide a slightly more formalized technique for local rural and small city road agencies that lack the resources for a comprehensive pavement management system. This rating system was not intended to apply to highways and major roads making up Michigan’s FAE network; however, it has been employed for over two decades  for these purposes. The drawbacks of MI-PASER are apparent when evaluating road condition forecasts based on the metric (Chart 3)

Chart 3
MI-PASER Ratings and Forecasts of Michigan’s FAE Pavement in Poor Condition, 2010 – 2023

Every forecast using MI-PASER has predicted more rapid pavement deterioration than was subsequently observed. As a subjective metric, the MI-PASER ratings should be interpreted with caution; it is unclear to what extent  ratings reflect real world system conditions. 

The 2025 Michigan Road Program Report provides alternative time-series assessments of Michigan’s pavement conditions using a standardized engineering-quality metric called the International Roughness Index (IRI). IRI data is much more meaningful and reliable than MI-PASER, but is available only on Michigan’s National Highway System (NHS) – a subset of the FAE network that includes only about six percent of Michigan’s public roads by system mile (Chart 4).

Chart 4:
IRI Ratings of Michigan’s NHS Routes by System Mile

The International Roughness Index is a much different metric than MI-PASER, and applied to a more limited extent of Michigan’s public road network. Thus, Chart 4 cannot be directly compared to Chart 2. That said, it is interesting to note that IRI data shows an increase in pavement in good condition since 2004, while MI-PASER data shows an increase in pavement in poor condition. One consistency between the two metrics is that they both show a decrease in pavement in fair condition.

The 2025 Michigan Road Program Report also provides a state-by-state comparison of road system condition. Seventeen individual pavement and bridge condition metrics reported nationally by the FHWA were converted to 0-100 index scores based on the range of data across all 50 states, and then combined into a final Road System Condition Index score. 

Michigan was found to rank 40th overall in system condition. 

Compared to other states, Michigan tends to rank better when comparing pavement in good condition than when comparing pavement in poor condition. For example, Michigan ranks 24th nationally in NHS pavement in good condition by IRI, but ranks 33rd in pavement in poor condition. Michigan ranks 18th in Interstate pavement in good condition by the federal pavement condition metric (PCM), but 44th in Interstate pavement in poor condition.

This suggests that, compared to a typical state, Michigan struggles to maintain pavement in fair condition through routine preventative maintenance.

How Funding Relates to System Condition

As described previously, the 2025 Michigan Road Program Report provides a broad assessment of Michigan’s road funding and system condition, both over time and compared to other states. The report brings  together both assessments to examine  road program “performance” – the ability to utilize given funding to achieve good system conditions. 

An analysis of available data shows a complicated relationship between Michigan’s road funding and system conditions. As Michigan’s road program purchasing power steadily declined from 2004 to 2016, system conditions deteriorated by some metrics, but improved in others. Likewise, as funding increased after 2016, most measures of system condition improved, but not universally. The relationship between funding and system condition is much more tenuous than might be expected.

This finding is supported by the cross-state analysis. When comparing funding to system condition across all 50 states, there is essentially no correlation between funding and condition.

This reflects the complexity of a road program. Agencies must make difficult and complicated decisions regarding how to invest a given amount of funding across a variety of road types with pavements and bridges in various conditions subject to variable traffic loads and other factors that influence pavement deterioration such as the pavement age, cross-section design, and drainage challenges. This leads to the conclusion that how road money is spent is more determinative of road condition than the overall funding level.

Policy Implications

The 2025 Michigan Road Program Report provides substantial evidence that Michigan is not underfunding its roads and bridges to the extent many have suggested. Michigan ranks 30th overall in road funding and, as of 2024, is better funded than at any time in the last twenty years.

Current policy discussions typically focus entirely on how much funding is going to roads. What is missing from these discussions is an understanding that how funding is spent is at least as important as how much funding is available. The data suggests that Michigan’s road program could be more efficient and more effective in converting road funding dollars to provide quality infrastructure.

Distribution of State Funding

Perhaps the most pressing need is to repeal and replace Michigan’s 74-year-old road funding law, Public Act 51 of 1951. Act 51 simply does not direct funding to where it is most needed. The distribution formula is inequitable. The 2025 Michigan Road Program Report provides additional evidence for this. For example, Michigan’s rural NHS routes are in great condition, while heavily-trafficked urban NHS routes are much poorer. In 2022, 86 percent of rural NHS was rated in good condition by IRI, ranking 7th nationally. Only 47 percent of urban NHS pavements were in good condition, ranking 35th nationally. There may be several factors contributing to this, but one factor is likely the Act 51 formula that distributes funding by things like system-mile and does not consider things like truck traffic that impose pavement damage.

Replacing Act 51 with a rational distribution formula would require serious thought and effort by Michigan policymakers. However, this is a necessary step to addressing Michigan’s road infrastructure problems.

Approaches to Pavement Management

Rationalizing the distribution of funding among Michigan’s 615 road agencies by replacing Act 51 would help get road funding to where it is needed most. However, there can still be inefficiencies in how each road agency spends that funding. A road network can be very complex. Planners and engineers must evaluate multiple project options and fixes within a multi-year program. A data-based transportation asset management system can provide critical decision support.

Michigan has adopted MI-PASER as its statewide pavement management system. However, this presents a problem because MI-PASER is not a traditional engineering-grade metric. It was originally designed for rural and small local road agencies that lack the resources for a comprehensive pavement management system. Despite this, state policy mandates its use as the primary evaluation tool for all federal-aid-eligible roads—including those managed by large urban agencies responsible for complex, high-traffic networks.

The 2025 Michigan Road Program Report provides evidence showing that adoption of MI-PASER as a basis for a statewide pavement management approach has not improved the efficacy of investment decisions. The cumulative ability of Michigan’s road agencies to cost-effectively manage their systems appears to have declined since 2004, the initial year of MI-PASER data collection. This finding is also apparent in the cross-state analysis, showing that Michigan typically ranks higher in pavement in good condition than pavement in poor condition.

A well-functioning pavement management system should prioritize maintaining pavement in fair condition across its life-cycle with routine preventative maintenance projects. Michigan generally appears to struggle with this, and the emphasis on MI-PASER as a basis of pavement management is a likely contributing factor. Michigan’s approaches to pavement management should be critically reviewed and likely updated to help provide road agencies with better decision-support when selecting projects.

Other Areas for Improvement

There are additional elements of Michigan’s road program that could be addressed to help fix the roads.

Local-option Revenue. Local governments in many other states have more options than in Michigan. Data is not available to allow for a meaningful analysis of local road funding and conditions in Michigan, or compared to other states. However, it is often argued that Michigan’s local road agencies are especially underfunded. Permitting local option revenue taxes to fund local roads is a potential partial solution.

Aggregate Availability. Road agencies and the construction industry frequently argue that permitting restrictions on mining operations for construction aggregates (sand and gravel) are increasing the cost of road construction. An assessment of available data suggests that aggregate costs have increased in recent years. This may be a minor contributor of road construction cost inflation in recent years, and deserves further independent study.

Speculative Projects. Time and money spent on experimental projects like autonomous vehicle infrastructure may be better directed toward basic road maintenance.

Coordinated Infrastructure Management. More integrated planning between road and utility agencies could reduce costs and improve efficiency. Michigan has recognized this and made some progress by encouraging “dig once” projects. However, there is potential for further improvement. Reducing inefficiencies imposed by uncoordinated infrastructure planning will require the state government take a more active role.

Take-away Message

The 2025 Michigan Road Program Report provides an objective review and assessment of a wide variety of data related to road funding and system conditions in Michigan. Despite conventional wisdom, data does not support the idea that Michigan has ‘historically underfunded’ its roads. Michigan has long struggled with deteriorating road conditions—but underfunding is only part of the problem.

Michigan’s road funding ranks in the middle of the pack and has reached a 20-year high. However, the state ranks near the bottom in road conditions. Without addressing inefficiencies in how money is distributed and spent, simply increasing funding may not solve the problem.

Before asking taxpayers for more revenue or reallocating state dollars, Michigan policymakers should evaluate how to make the most of the funding already available.

Read the full report here: A Data-Driven Assessment of Michigan’s Road Program (2025)