Last October, the Michigan Promise Scholarship, a merit-based scholarship for Michigan high school students who attend Michigan colleges, was scrapped. This left around 100,000 students without state help in paying for college. Governor Jennifer Granholm, in her recent state address, has proposed a tax credit for Michigan students who want to stay in state after college graduation. The tax credit would amount to how much students were getting before the elimination.
This plan has a number of clear holes, among them is whether this is a realistic incentive to stay in Michigan and the issue of who is actually paying for the college education. The tax credit will give students money after they graduate, increasing over time in order to encourage them to stay in the state.
Efforts to keep the Promise are to great relief of students, but perhaps this isn’t the best course of action.
What was nice about the scholarship the way it was before this fiscal year was that it actively helped students pay for college as they were enrolled, but the new proposal doesn’t lighten the burden until students graduate.
This is discouraging for a number of reasons. Often, when students are in college, it is their parents who are paying for their college education. This tax credit isn’t for the parents, though; it’s going directly to the student after four years of their parents paying.
Additionally, by initiating the tax credit after the student graduates, the state is only pushing off the cost for years to come. Hoping that the recession will get better in a couple of years, before the cost of this tax credit catches up with the state, is naïve and a risky guessing game. We don’t know when the economy will improve, so by delaying the costs, the state is not doing itself any favors.
According to a March 10 report by the Bureau of Labor Statistics, the unemployment rate in Michigan is 14.3 percent. And, while the structure of this plan is to encourage employment in Michigan, the assurance of jobs is clearly missing.
Students can stay here, sure, but if there are no jobs, then the tax credit is pointless. Perhaps efforts need to be focused more toward the creation of jobs so that students will have an incentive to stay here regardless of a fiscal incentive.
Students, and the Michigan Promise Scholarship, would benefit more if Granholm went back to the drawing board. If the goal of the scholarship is to keep students in state, but maybe a tax credit is not the best idea.