The Michigan Legislature recently approved the state’s $82 billion budget for the 2023-2024 fiscal year. Education, infrastructure, and the environment all received significant funding in the state’s largest-ever budget. Also included was more than $145 million allocated to clean mobility initiatives, with funds provided for clean school bus grants, electric vehicle charging infrastructure, and state fleet electrification.
The clean transportation industry will experience many benefits from this year’s budget, including increased business opportunities, job creation, technological advancement, and economic development as the state continues to prioritize clean mobility.
Some key wins for the industry include:
- Clean School Bus Grant Program: In what is likely the biggest win for the clean transportation industry, the state school aid fund received a one-time $125 million allocation to fund a clean school bus grant program. This program will be critical in assisting school districts in retiring diesel buses and replaces them with cleaner alternatives such as propane, renewable natural gas, or electric buses. This initiative will create a healthier environment for students by reducing emissions and provide school districts with cost savings as they benefit from lower maintenance and operating costs of clean school buses.
- Critical Mineral Recycling Research: The omnibus budget includes a one-time $5 million allocation to support research into the reuse of critical minerals for clean energy production and storage. This program will drive resource efficiency and technological innovation in Michigan. Investing in research and development of critical mineral recycling will help to establish the local supply chain and reduce dependence on imported materials. This can lead to the growth of recycling industries, job creation, and further develop Michigan’s circular clean energy sector.
- Lake Michigan EV Charging Circuit: The budget includes and one-time allocation of $5 million to support the construction of EV charging stations along the Lake Michigan shoreline. In collaboration with Wisconsin, Illinois, and Indiana, the completed circuit will provide EV drivers with reliable charging options along the 1,110-mile route. This investment will stimulate regional tourism, promote EV adoption, and build robust charging infrastructure in some of the state’s most rural communities.
- State Fleet Electrification: The budget also includes $1 million for ongoing administrative costs related to fleet electrification and to analyze the infrastructure needed to transition the state fleet to electric vehicles. As Michigan begins to transition its fleet vehicles to cleaner alternatives, the state sets an example for other public and private entities, driving market demand for EVs and reducing emissions.
- Various Clean Mobility Implementation Grants: Various departments received funding to support grant programs for various clean mobility projects. These include the Mobility Fund Platform administered by the Office of Future Mobility and Electrification; RNG and electrification infrastructure development funding administered by the Public Service Commission; and the Minority Owned Business Support and parking infrastructure upgrade funding, both administered by the Department of Labor and Economic Opportunity.
With more than $145 million dedicated to funding clean mobility initiatives, the State of Michigan’s budget for 2023-2024 makes important investments to sustain and improve the clean mobility economy in Michigan. However, it is important to note that some of these programs were underfunded, and some budget items that would assist in advancing clean mobility goals in Michigan are missing from this year’s budget.
Items that we will continue to advocate for include:
- Michigan Clean Fleet Initiative: This program would have provided grants to counties, municipalities, airports, and regional transportation authorities to convert fleet operations to net-zero greenhouse gas emissions, which would allow public entities to lead the transition to clean transportation, bolstering consumer confidence and advancing environmental and public health goals by reducing emissions.
- Electric Vehicle Sales and Use Tax Exemption: This program would allow for a temporary sale and use tax exemption on the purchase of electric vehicles to incentivize their adoption for two years. Initiatives like this help offset the initial cost of EVs, allowing more Michiganders to benefit from clean transportation.
- Broader Electric Vehicle Charging Incentives: This program would have funded electric vehicle charging infrastructure at multi-family dwellings and for medium- and heavy-duty fleet applications.
These missed funding opportunities will need to be prioritized in consideration of supplemental funding and for following budgets. Ensuring that these programs receive funding will be necessary for Michigan to remain at the forefront of the transition to clean transportation.
Despite these unfunded programs, there is still plenty of room for celebration. The clean mobility items that did receive funding in this year’s budget present numerous opportunities for job creation, business growth, and technological innovation within Michigan’s clean transportation sector. Clean Fuels Michigan applauds Governor Whitmer and the Michigan Legislature for including many important budget items to promote the clean mobility economy in Michigan and will work with relevant state teams to ensure these programs are implemented to their fullest potential.
A full policy brief, including program details and boilerplate, can be found here.
