No, pot money won’t fill Michigan’s potholes — not even close

By: - March 8, 2019 3:48 pm

Gov. Gretchen Whitmer’s 45-cent gas tax increase to fix the roads has been met with a wide range of questions since she proposed it this week as part of her fiscal year 2020 budget.

Late winter road work in Meridian Township | Susan J. Demas

One of the most popular ones has been: Why can’t the state just use all the tax money from now-legalized recreational marijuana?

Simply put, pot won’t come close to filling Michigan’s potholes.

Should the industry really take off, the state could see as much as $225 million pour into its coffers by 2023, according to an analysis last year by the Anderson Economic Group, an East Lansing economic consulting firm.

With slower growth, the industry could bring in about $127 million in tax revenue for the state.  

But by 2021, the state is forecast to be needing upwards of $3 billion for its beleaguered roads, according to a 2019 report from the nonpartisan Senate Fiscal Agency.

In that same year, Michigan’s State Transportation Fund will take in just $43 million from pot sales.


To put that in perspective, that money would only fund about half of Oakland County’s planned road projects this year. The state’s second-largest county by population has about $80 million worth of road construction projects slated for 2019.

Colorado —  the first state to legalize weed, having done so in 2014 —  has taken in about $927 million in tax revenue since that time.

That would approach half of what Whitmer says is needed for Michigan’s roads every year.

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Nick Manes
Nick Manes

Nick Manes is a former Michigan Advance reporter, covering West Michigan, business and labor, health care and the safety net. He previously spent six years as a reporter at MiBiz covering commercial real estate, economic development and all manner of public policy at the local and state levels.