Infrastructure Funding Can Help Michigan's Small Businesses

Last November, Governor Rick Snyder signed an important roads funding package that dedicates $1.2 billion in funding to improving our roads. This package will go a long way in improving our infrastructure to benefit small businesses.

Michigan’s roads are ranked worst in the nation, and in the Metro Detroit area, bad roads cost each driver an estimated $866 a year in vehicle damage. That puts us at a competitive disadvantage with other states.

Bad roads mean higher shipping costs, supply chain delays and more expensive transportation. It’s hard to run a bakery if shipments of flour have trouble making it down your street, or if it’s too expensive to send your product to suppliers. Ultimately, bad roads translate to lost profits and reduced revenue for small businesses.

Clearly, the economic costs of leaving our roads in disrepair are too high. That’s why the roads funding package is mostly good news for our state. But while we passed the bill, we still need to hammer out the details on how we’re funding it. The plan doesn’t devote a full $1.2 billion in funding to transportation until 2021, with increasing amounts allocated annually until then.

Part of the funding for roads will mostly be covered by increases in taxes and registration fees, which will generate around $600 million annually. But once the plan is fully phased in, the rest of the funding will need to be taken from the state’s general fund, which is used to pay for state services like education and social services. By 2021, $600 to $800 million is slated to come from the general fund to cover road repairs. This investment is going to require some trimming of our budget in other areas.

The bottom line is that overall, repairing our roads is important. But funding this investment won’t be without a challenge. It’s important to include small business voices in this conversation so we can prioritize our spending and be smart about our budget.

We’ve been holding interactive events around Michigan to get feedback from small businesses on this important issue. Stay tuned to our events page to learn about how you can work with us on this issue.