The Michigan Department of Transportation (MDOT) administers the Freight Economic Development Program (FEDP), which provides financial assistance to businesses and entities seeking to connect to or expand their use of Michigan’s rail system. The program aims to promote economic growth, increase rail freight volumes, and improve rail infrastructure statewide. By subsidizing critical infrastructure upgrades, MDOT helps enhance the viability and utilization of rail transport across Michigan.
FEDP grants may cover up to 50 percent of costs associated with constructing or rehabilitating rail infrastructure, such as spurs, turnouts, tracks, unloading equipment, and related permanently affixed systems. A single applicant may receive up to $2 million in total funding. The grant provides an initial payment of up to 45% of eligible costs after project completion and verification, followed by a potential 5% distributed over five years based on annual carload increases. Ineligible costs include engineering expenses, car movers, and storage facilities.
Applicants must demonstrate control over the property where the infrastructure will be built, either through ownership, long-term lease, or easement. Entities eligible for this program include businesses, municipalities, and railroads undertaking infrastructure improvements to serve specific rail customers. All projects must lead to an increase in statewide rail volume and are evaluated based on economic impact, job creation, and public safety benefits.
Applications are accepted at any time and are reviewed on a rolling basis. It typically takes six weeks from submission to contract award. No fixed deadlines or specific open/close dates are enforced. However, all required materials—including project descriptions, layouts, cost estimates, and contact information—must be included for the application to be considered.
MDOT requires compliance with safety regulations and may request variances to be submitted through Form 1401. If the project affects public road crossings, an additional form (MDOT 1425) must also be submitted. The application process is detailed and should be completed carefully to ensure all eligibility requirements and project evaluation criteria are met.
For more information or to submit an application, applicants should contact Alex Nikoloff, Freight Economic Development Project Manager, at NikoloffA@Michigan.gov or call (517) 290-9691.
Submit detailed cost estimate with no more than 10% contingency; demonstrate additional carload volume beyond current usage; safety and clearance approvals may be required; contact MDOT Rail Safety for variances or crossing impacts.
