Pothole fund pays 6% of submitted claims in 2024 and 2025

Michigan motorists who drive on state highways run the risk of having their vehicles damaged by potholes. Some seek compensation from the state, but only 6% of those who do get anything, according to documents Michigan Capitol Confidential obtained from the state transportation department.

Motorists filed 218 claims in 2024, but only 13 received payouts, for a total of $5,953.

Compensation has been meager this year as well. As of June 12, the state has paid a total of $1,668 for six claims, out of 86 filed.

A person seeking reimbursement for damages must sign a claim form, have it notarized, attach supporting documents, and submit it all to the regional office responsible for the road that caused the damage. Two laws, MCL 691.1402 and MCL 691.1403, give the state widespread immunity from most lawsuits. The pothole must have existed for at least 30 days before the damage happened, the law says. 

There is no dedicated funding for these payouts, Michael Frezell, a senior communications manager at the Michigan Department of Transportation, told CapCon in an email. “If a damage incident is project-related, it would get charged to the project, which is typically covered by the contractor. If it is a maintenance issue, then it gets charged to the maintenance appropriation. With chronic lack of investment, road degradation will be a continual problem, causing more potholes and an inconvenience to motorists. Once a long-term investment strategy is implemented, road agencies across the state can make long-term full repairs that ultimately will reduce these damages.”

Highway defect claims (including potholes) should only be submitted to the department if the damage occurred on a state trunkline highway, which are numbered roads that start with the letters M, I or US. The state does not offer compensation for damage incurred on county or local roads.

Upon receipt of a damage claim under $1,000, MDOT will investigate the incident. Investigations typically take at least 90 days.

Michigan bought about $40 million worth of salt to melt snow in 2024 and 2025, according to a document obtained through a records request. The salt eats away at paint and car panels, causing other vehicle damage.

Michigan’s 2025 budget is a record $83 billion, but the roads here, especially county and local roads, are falling apart faster than they are being repaired. In 2018, Gov. Gretchen Whitmer campaigned on fixing the roads. In her proposed 2026 budget, the second-term governor proposed spending $7.8 million to study road funding.