US Transportation Secretary Sean Duffy last month warned states and other grant recipients that their funding could be revoked if they don’t cooperate with federal authorities on immigration enforcement or if they maintain any DEI programs. “It is the policy of the department to award and to continue to provide federal financial assistance only to those recipients who comply with their legal obligations,” Duffy told officials in a letter, adding that the department would “vigorously enforce” the policy and audit grantees’ compliance. And this week, the Trump administration took steps to dismantle the federal Disadvantaged Business Enterprise program, which the Michigan Department of Transportation and other state agencies have used for decades to ensure women- and minority-owned businesses win a certain percentage of federal contracts.
The Department of Justice this week sided with two Indiana construction firms suing the federal Department of Transportation, proposing a settlement that would effectively end the DBE program if courts approve. The directives come as the Trump administration eyes other possible changes to the way the federal government awards transportation funding, including prioritizing regional marriage and birth rates when considering grant applications. Duffy has described the proposed shift as “restoring commonsense governance and merit-based policies” and said US citizens “deserve an efficient, safe and pro-growth transportation system.” Federal funding accounts for $2.3 billion — or 33% — of MODT’s current budget.
Industry experts told Bridge Michigan that the bulk of the state’s existing federal dollars — formula-based funding that helps cover construction and maintenance costs for state highways, public transit, rail and airports — are not expected to see cuts. But the future of more than a dozen Michigan projects awarded a cumulative $500 million under former President Joe Biden remains in limbo. The Trump administration froze grant funds from the 2021 Infrastructure Investment and Jobs Act while federal agencies review whether the grants comply with the president’s policy goals.
RELATED: According to MDOT, three of 17 pending IIJA grants have been approved to move ahead with the grant agreement process, including $20.4 million for a project to replace a railroad bridge over the Manistee River, which was included in the US Department of Transportation’s latest round of federal transportation grants on May 6. Other unfrozen funds include a $467,000 grant for a wildlife crossing pilot and a $552,000 grant for thermal imaging cameras on transit vehicles to prevent pedestrian crashes. What’s at stake Michigan’s paved federal-aid roads make up one-third of the state’s roadways and carry more than 95% of overall traffic, according to the Transportation Asset Management Council.
They’re funded in part by the Federal-Aid Highway Program, which historically funnels multi-year funding to states through a formula that considers population size, density and other factors. “The goal of the formula is to allocate it by need — how many roads do we have, what's the lane mileage and so forth,” said Bob Schneider, of the nonpartisan Citizens Research Council. The 2021 act approved by Congress authorized $356.5 billion in spending through 2026, with Michigan getting an estimated $1.6 billion per year.
Because that formula is written into federal law, those funds are likely secure, said Lance Binoniemi, of the Michigan Infrastructure and Transportation Association, a trade group representing the construction industry. But individual Biden-era transportation grants could end up on the chopping block — and any reduction in transportation funds “just exacerbates the problem that we already have in our funding,” Binoniemi said. In the multistate lawsuit challenging the Trump administration’s directive, Nessel and other attorneys general specifically referenced a project to reconstruct the high-traffic I-75 bridge over River Raisin in Monroe County, for which Michigan was awarded $196 million in federal grants before the funds were paused.
Another $73.5 million supporting a new bridge to separate M-85 from a busy railroad crossing in Trenton is also on hold, as is $25 million for replacement of the East Beltline Bridge in Grand Rapids, $25 million for rebuilding a 2-mile stretch of US-12 in Corktown and a $34.2 million investment in local bridge replacements around the state.
