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2012 February 6 - 12:00 am

Michigan Democrats Developing College Grant Plan

LANSING, Mich. (AP) — Democrats in the Michigan Senate said they’re developing a proposal that would allow Michigan high school graduates to get grants of up to roughly $9,500 a year for attending college by ending some business tax credits and other revenue changes.

The grants could be used to pay tuition or associated costs at public universities and community colleges in the state. The money would be raised by closing what Democrats call tax loopholes and ending some business tax credits, collecting sales tax from out-of-state Internet retailers and saving money on state contracts.

Sen. Gretchen Whitmer, the Senate’s Democratic leader, said investment in education is needed to revitalize Michigan and boost its economy. State aid for public education has dwindled in recent years, with universities facing a 15 percent reduction in state aid for operations in the current fiscal year. Universities say reduced state aid is a major factor contributing to tuition increases.

“We’ve got to not just reverse that trend, but we’ve got to do something bold to say Michigan believes in education and this is a great place to come and locate your business because we’ve got the work force you need,” Whitmer told The Associated Press.

The proposals, which could soon be formally introduced in the Senate, likely would face long odds against passing in the Republican-led Legislature — particularly as Michigan continues to struggle with its state budget.

The grants would be renewable for up to four years. The size of the grant would be based on how long a particular student spent in Michigan’s K-12 school system, with the maximum annual amount pegged to the median tuition level at Michigan’s 15 public universities.

Democrats estimate the annual cost of the program would be $1.8 billion once fully implemented. It would phase in with new high school graduates headed to college.

Democrats say the plan could be accomplished without tax increases for Michigan citizens. But some businesses or others who could lose tax credits or exemptions under the plan would face higher tax bills than before, which would be a concern for Republicans.

“Senate Republicans are open to discussing ideas for how to keep our students in Michigan and to encourage them to attend our state universities, but we also must always be cognizant of the costs associated with any new policies,” said Amber McCann, a spokeswoman for Senate Majority Leader Randy Richardville.

Republicans outnumber Democrats in the Michigan Senate, 26-12.

Republican Gov. Rick Snyder’s administration would not react directly to the Democratic proposal because it hasn’t seen specifics of the plan.

Snyder spokeswoman Sara Wurfel said the governor is committed to helping ensure college affordability and investing in education when possible.

“That said, it’s also simply not just about more money,” Wurfel said in an e-mail. “It’s about achieving the best outcomes and results possible.”

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