The Chronicle of Higher Education

Thursday, July 1, 1999

Michigan Arranges Universities in Tiers to Bring Symmetry to Financing
By PETER SCHMIDT

Gov. John Engler of Michigan on Wednesday signed into law a measure that sorts the state's 15 public universities into five tiers -- a division he says will bring more order and fairness to how the institutions are financed.

The bill also appropriates nearly $87-million for a new merit-based college scholarship program, with much of the money expected to come from Michigan's share of a legal settlement between a coalition of state governments and the nation's major tobacco companies.

The state's decision to group its public universities in separate tiers is a response to its lack of a higher-education coordinating board, and the vagaries in the universities' appropriations caused by their historic competition over funds in the state Legislature.

"My future executive budget recommendations will use these tiers to continue to address funding inequities between our universities," Governor Engler said Wednesday in a letter informing legislators that he had signed the measure.

Governor Engler, a Republican, had initially proposed dividing the state's public universities into four tiers to more systematically address their enrollment growth and past financing inequities. Each had its own "floor" in terms of the minimum amount that the state would appropriate for it, per student from within the state, each year.

The state House of Representatives approved Mr. Engler's plan in March, but its progression through the Senate was blocked by the chamber's president pro tem, Sen. John J.H. Schwarz, also a Republican, who argued that the Governor's proposed financing formula would hurt some research-focused universities with large enrollments of out-of-state and graduate students, such as the University of Michigan.

The Senate adopted an alternative bill, drafted by Mr. Schwarz, to force leaders of the two chambers to hammer out a conference-committee compromise that would respond to the Senator's concerns. The bill that emerged, and that was adopted by both chambers last month, calls for the universities to be divided into five groups, based on their missions and programs. The tiers, with their minimum appropriation per student:

The state's new Michigan Merit Award scholarship program, also approved by lawmakers last month, will provide college scholarships of up to $2,500 to high-school students who demonstrate their mastery of basic skills on standardized tests.

Copyright © 1999 by The Chronicle of Higher Education