News and analysis from The Center for Michigan •
©2015 Bridge Michigan. All Rights Reserved. • Join us online at

Original article URL:

Economy & competitive position/Public sector

Inflation takes bite out of road repairs

Michigan citizens know the pocketbook pressures of rising prices for such everyday items as bread, milk and even the occasional beer.

But less evident are the increased costs of the materials needed to build and repair the roads on which they drive. That means that the pennies of tax placed on each gallon of Michigan gas don’t go as far as they used to, which, in turn, affects how many roads Michigan can repair.

After Michigan raised its gas tax by 4 cents in 1997, it spent about $450 million in each of the next two fiscal years to repair 1,350 lane miles of roads annually. Lane miles are one mile of one lane of highway, per direction.

In fiscal 2012, the state spent $475 million, but fixed only about 1,275 lane miles. And that’s mainly a result of the reduction in purchasing power due to increased cost of construction, the Michigan Department of Transportation says.

For example, data from MDOT show that in the five years from 2005 to 2011, prices for asphalt have risen 46.8 percent, from $40.54 a ton to $59.53 per ton. Reinforced concrete that cost $47.20 per cubic yard in 2005, cost $79.99 in 2011, a nearly 70 percent increase.

Structural steel prices over the five-year span fluctuated. Steel that was $1.99 per pound in 2005 rose sharply to $3.84 the following year and then dropped, only to rise for three more years before dropping to 2011’s $1.79 per-pound price.

“The steady run-up on asphalt and concrete prices means we can fix fewer miles of roadway and bridges with our available funding, and fluctuations in steel prices make it impossible to predict some other costs,” said MDOT spokesman James Lake.

Most Michigan families know about inflation. A pound of bread that cost an average $1.04 in 2005 cost $1.44 in 2011, while a gallon of milk that was an average $3.18 in 2005 cost $3.57 in 2011. A 16-ounce malt beverage that cost an average $1.09 in 2005, rang up at an average $1.24 in 2011, according to U.S. Bureau of Labor Statistics Consumer Price Index average price data.

Still, in most recent years, prices of highway and bridge construction have annually outpaced inflation nationwide, according to data cited by the Michigan Infrastructure and Transportation Association. For example, in 2011, highway and bridge costs registered a 4.8 percent increase, compared with a 3.2 percent increase in the Consumer Price Index.

Add it all up and it simply means more money, fewer repairs.

Amy Lane is a former reporter for Crain's Detroit Business, where she covered utilities, state government and state business for many years.

1 comment from a Bridge reader.Add mine!

  1. Matt

    Guess I’m just a bit confused on the money here. My understanding is that MDOT receives around 3.3 billion dollars a year in funding. Where is the rest of the money?

Leave your comment...

Your email address will not be published.

Currently on Bridge

An Earth Day pitch: When you hang up the phone for good, toss it the right way

Michigan’s roads affect everyone, so a 'yes' vote on Proposal 1 makes sense

‘Diplomacy Begins Here’ conference aims to illuminate international relations

What NOT to post on Facebook: Jokes about prison rape, when you’re in charge of preventing prison rape

A program to give young offenders a second chance is sending many to prison

Similar accounts in suit over alleged teen prison rapes pose challenge to state's defense

‘New fish’ ‒ One teen inmate’s account of alleged sexual assault

Early learning summit in June could impact Michigan’s children

Money Smart Week: Be penny wise, and pound savvier

Plan B or no Plan B, here’s what happens if road proposal fails

The political tale behind the selling of Proposal 1

A Bridge primer: Untangling the pothole promise of Proposal 1

Who supports, and opposes, Proposal 1

Let's rebuild Michigan through its greatest asset: its water

Could a public boarding school model work in Detroit?

Coalition supporting Detroit schools a step in the city’s road back

Chasing fads? Today’s schools are struggling too much for that

For one Michigan legislative staffer, an hour or two in the spotlight

A cull is a kill, and it’s an overreaction to deer ‘problem’

Lack of college guidance keeps poor and rural students from applying

Those who can, do – and get their hands ‘dirty’ in the process

For one Detroit mom, a complicated path to employment

Detroit by the numbers – the truth about poverty

Michigan should require dental screening for all children entering kindergarten

Where in the world is the Center for Michigan?

After two years, hard to call ACA anything but a success

Bridge’s Academic State Champs emphasizes all the wrong measurements

A graying population poses challenges for Up North counties

Up North, isolation impedes health care for seniors

Enbridge oil pipes and the Straits of Mackinac: Too risky to ignore

Not bigger government, but better services when Community Health and Human Services merge

Two Michigans gaze across a widening gap

In northern counties, workers and business find each other lacking

Hidden poverty stalks a Pure Michigan setting

Postcard: How a git-’er-done spirit helps one rural school district

Postcard: When elk is for dinner

Postcard: Luxe life at Bay Harbor reflects changing economy

Postcard: A roof and a bed

Invest in non-partisan journalism.

Donate to The Center for Michigan. Find out why.