Not all states saw an increase in financial aid in recent years. In Michigan, financial aid to public institutions decreased by 96.8 percent from $675 per FTE in 2001 to only $22 per FTE in 2019. Aid as a percent of all appropriations declined from 5.7 percent in 2001 to 0.3 percent in 2019.
This decline reflects legislative efforts to rebalance the state budget following the Great Recession, which severely impacted Michigan’s economy. In 2010, the Michigan Legislature eliminated several financial aid programs, totaling an estimated $150.4 million in financial aid cuts. For the remaining financial aid programs, most of the state general fund support was replaced with federal funds from the Temporary Assistance for Needy Families (TANF) program in FY 2012.
In fiscal 2019, gross funding for student financial aid in Michigan was $139,583,200. Of that total, only $13.7 million came from state general funds (52.6 percent of which went to public institutions), and the rest was federally funded.
In recent years, the governor has proposed that the state reinvest in student financial aid programs, including a new state grant that would provide tuition-free opportunities for adult students at two-year institutions.
Unfortunately, Michigan’s general fund revenue levels have mainly remained flat for over 20 years. This is due to a combination of economic factors, tax policy decisions, and diversions of the general fund for road repair and infrastructure investment.