(1) The department shall develop and implement a life-cycle cost analysis for each project for which the estimated total pavement costs exceed $1,500,000.00 funded in whole or in part with state funds. The department shall design and award paving projects utilizing material having the lowest life-cycle cost. All pavement design life shall ensure that state funds are utilized as efficiently as possible.

    (2) As used in this section and section 1i, “life-cycle cost” means the total of the cost of the initial project plus all anticipated costs for subsequent maintenance, repair, or resurfacing over the life of the pavement.

    (3) Except as otherwise provided in this section, life-cycle cost shall compare equivalent designs and shall be based upon Michigan’s actual historic project maintenance, repair, and resurfacing schedules and costs as recorded by the pavement management system, and shall include estimates of user costs throughout the entire pavement life.

    (4) For pavement projects for which there are no relevant Michigan actual historic project maintenance, repair, and resurfacing schedules and costs as recorded by the pavement management system, the department may use either of the following as a substitute for the requirements listed in subsection (3):

    (a) Actual historical and comparable data for reasonably equivalent designs from geographic locations with similar climates, soil structures, or vehicle traffic.

    (b) The department may determine appropriate estimated maintenance, repair, and resurfacing schedules for a project by using preliminary results from a demonstration project described in section 1i(1) that is underway at the time of the project. The schedules described in this subdivision shall be determined using appropriate engineering analysis techniques and shall be approved by the chief engineer of the department. The temporary schedules described in this subdivision shall be superseded by actual performance data as it is developed.