Michigan Budget Could Decrease Need-Based Aid

But more students would be eligible for aid, and the amount going to merit-based aid would increase.

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Michigan Gov. Jennifer Granholm has proposed a state budget that would increase the amount given for merit-based scholarships while reducing the amount disbursed for need-based grants, the University of Michigan's Michigan Daily reports. The state budget proposal would increase by $59.5 million the funding for the merit-based Michigan Promise Grant program, making its total budget $140 million.

The budget calls for consolidating six existing need-based and merit-based programs into a $90 million combined fund that would be called the Michigan College Access Grants. Its budget would be 5.8 percent less than was distributed to the six separate funds last year.

One silver lining is that the plan would make more students eligible for need-based aid. The Detroit Free Press reports:

The plan likely will widen the pool of students who receive grants from more than 80,000 during the 2007-08 school year to roughly 89,000 need-based students, who would receive $1,000 each.

Under the plan, students likely will qualify if their family income is less than $80,000, according to the governor's office.

But other students could see their scholarship opportunities shrink or vanish, including nursing students, who receive up to $4,000 a year, and private-college students, who get up to $2,100 a year.