Michigan Promise imperiled by budget deal

LANSING, MI – The budget debate at the state Capitol grew more heated Wednesday. A bipartisan budget committee voted to eliminate the popular Michigan Promise college scholarship as part of a higher education spending plan. The controversial budget could be voted on by the state House as soon as Thursday over the objections of Governor Granholm.

Governor Granholm has made saving the Michigan Promise scholarship a high priority. Her office issued a statement saying she's very opposed to the budget. But the governor stopped short of saying she'd veto the bill if it reaches her desk - leaving the future of the scholarship hanging in doubt.

"I would certainly hope the governor would veto it."

State Representative Joan Bauer chairs the House higher education budget subcommittee. She was one of two Democrats on a team of House and Senate negotiators to vote against the compromise spending plan.

"I could not vote for a budget that cut $140 million in Promise grants..." she says. "...scholarships that we have promised our young people and our students, and in addition, I could not support something that cut another 60 million in other financial aid."

That includes competitive scholarships, nursing scholarships and work-study money.

If that happens, the decision will hurt students, says Michael Boulus, a lobbyist for state universities. And he says it gives a black eye to higher education and efforts to keep young people in Michigan.

"It takes us from being one of the top third the bottom third in terms of state financial aid at a time when access and affordability are pretty key issues," he says.

The Michigan Merit Award was created 10 years ago by Republican Governor John Engler. It was a new entitlement that would go to families regardless of their incomes, as long as students scored well on standardized achievement tests and graduated from high school.

Three years ago, Governor Granholm raised graduation standards and asked the Legislature make the scholarship available to every high school graduate who completes two years of college or career training. And they changed the name of it to the Michigan Promise.

This year, 96,000 students qualified for the $4,000 grant. The money for the Promise, like the Merit award, was secured using part of the state's share of the national tobacco lawsuit settlement.

But now the state it's in a budget crisis, and that money is needed to help retire an almost $3 billion deficit, says Republican Senator Tony Stamas.

"The state's lost 23% of its revenue in the last 11 months," he says. "We have a constitutional obligation to provide a balanced budget. That's going to require some difficult decisions."

Stamas says eliminating the scholarship is tough, but it's better than raising taxes during a recession.

But some Democrats say it's time to start looking at tax increases, among them House Appropriations Committee Chairman George Cushingberry.

"I would vote to boost revenue today, but do I have 56?," he asks.

Cushingberry's talking about the 56 votes needed to pass a tax hike in the House. He shouts over to Democratic Representative Rick Hammel.

"I'm counting. Do I have 56 for revenue, Hammel? (laughs) I'm asking you! (laughs) He doesn't even want to talk about it. But, I'm serious. How you gonna do it? You tell me."

Cushingberry says a tax on bottled water and soda pop would mostly fund the scholarship. Governor Granholm's also called for new taxes to help balance the budget. But Granholm and Cushingberry still need to recruit 55 more people in the House, as well as 19 state senators to their cause if they're going to raise the money to keep the Michigan Promise.