The Transportation Economic Development Fund (TEDF) Category A grant program is designed to provide financial assistance to local road agencies and the Michigan Department of Transportation (MDOT) for infrastructure projects that support economic development. Established in 1987 and revised in 1993, the program aims to improve highway networks to enhance economic competitiveness, provide accessibility to key industries, and support job creation or retention. The funding is sourced from taxes collected on fuel purchases and driver’s license fees.
The primary objective of the TEDF Category A program is to reduce transportation-related barriers to economic growth by funding road projects that directly support industrial and commercial development. Projects eligible for funding must demonstrate an immediate economic development need, such as improving road conditions, expanding capacity, enhancing safety, or providing better accessibility. The fund prioritizes transportation investments that support high-impact industries, including manufacturing, agriculture, tourism, and high-tech research, among others.
Funding is available for state, county, and municipal road agencies, as well as MDOT, to improve transportation infrastructure necessary for economic expansion. Eligible projects must be tied to a specific development project that creates or retains permanent jobs and increases the local tax base. The grant requires a minimum local funding match of 20% of total eligible project costs, though historically, successful applicants have contributed 40–50% in matching funds.
Applications are accepted year-round and must be submitted through the MDOT Grant System (MGS). The process begins with a Letter of Interest to determine project eligibility. If deemed eligible, the applicant proceeds to submit a full application, which includes project descriptions, economic impact data, engineering estimates, and financial viability evidence. Scoring is based on economic impact, project feasibility, and alignment with state economic development goals. The review process includes multiple levels of technical analysis and scoring by MDOT staff, followed by final approval from the MDOT director and Michigan Economic Development Corporation (MEDC).
Projects awarded TEDF Category A funding are subject to specific implementation guidelines, including compliance with state and federal transportation standards. Grant recipients must complete projects within two years of receiving funds, and non-compliance may result in fund withdrawal. A post-grant survey is conducted to verify job creation and economic impact as required by state law.
