Signed by Governor Jennifer Granholm

Vote Smart's Synopsis:

Vote to pass a bill that authorizes the creation of promise zone authorities in areas that meet a specified poverty threshold to provide financial assistance to students in those areas during their postsecondary education.

Highlights:

-Specifies that an entity is eligible to create a promise zone if it is a city, township, county, local school district, or intermediate school district where the percentage of families with children under 18 who live at or below the federal poverty level is greater than or equal to the state average of families with children under 18 who live at or below the federal poverty level (Sec. 3). -Requires financial assistance to students within a promise zone to be at least enough to cover the tuition necessary to obtain an associates degree or its equivalent at a community or junior college or, at most, enough to cover the tuition necessary to obtain a bachelor's degree or its equivalent at a public postsecondary institution in Michigan (Sec. 7). -Prohibits that financial assistance from being provided to fund attendance at an institution outside of Michigan (Sec. 7). -Requires a promise zone authority to prepare a promise zone development plan which includes the following information (Sec. 7): -A description of the proposed promise of financial assistance; -A description of any limitation on the promise of financial assistance; -A requirement that eligible high school graduates exhaust all other available restricted grants for postsecondary education; -How necessary funds will be raised; and -An actuarial model of the estimated costs of the program. -Requires that the promise zone development plan be submitted to the Department of Treasury promptly after its adoption and that it be published on the eligible entity's website; also requires the department to review and approve the plan or provide notice of deficiencies at least 60 days after receipt of the plan (Sec. 7). -Authorizes the state to capture half of the increase in revenue in each year after the base year to use for the purposes of this bill; the base year is referred to as the amount of revenue received from the collection of the state education tax in promise zone in the year prior to the year that the promise zone authority makes its first financial assistance payment or the amount of revenue received from the collection for the state education tax in the promise zone in any one of the three immediately succeeding years, whichever is less (Sec. 17). -Authorizes the Department of Treasury to oversee the actions of promise zone authorities and to assume control over an authority if it does not act in accordance with its proposed development plan (Sec. 19). -This is a substitute bill sponsored by Rep. Melton.

Full Bill Text

Vote Smart's Synopsis:

Vote to pass a bill that authorizes the creation of up to 10 promise zones in areas that meet a specified poverty threshold to provide financial assistance to students in those areas during their postsecondary education.

Highlights:

-Specifies that an entity is eligible to create a promise zone if it is a city, township, county, local school district, or intermediate school district where the percentage of families with children under 18 who live at or below the federal poverty level is greater than or equal to the state average of families with children under 18 who live at or below the federal poverty level (Sec. 3). -Specifies the following process for the creation of a promise zone (Sec. 5): -The governing body must set a date for a public hearing to discuss the establishment of a promise zone; -The eligible entities must submit an application to the Department of Treasury to establish a promise zone no less than 30 days after the hearing; and -Upon the Department of Treasury certifying eligibility, the governing body must pass a resolution establishing the promise zone. -Requires that financial assistance provided under the terms of a promise zone be no more or less than an amount that is sufficient to cover the tuition necessary for an eligible student to obtain an associates degree or its equivalent at a community or junior college in Michigan; also allows financial assistance for educational improvement activities at public schools that increase readiness for postsecondary education (Sec. 9). -Authorizes that financial assistance to be contingent on the number of years the student has resided in the promise zone, the maintenance of a minimum college grade point average, a minimum college credit courseload, or to attendance of one or more specific public/private postsecondary institutions in the state (Sec. 9). -Requires a promise zone authority to prepare a promise zone development plan which includes the following information (Sec. 9): -A description of the proposed promise of financial assistance; -A description of any limitation on the promise of financial assistance; -A requirement that eligible high school graduates exhaust all other available restricted grants for postsecondary education; -How necessary funds will be raised; and -An actuarial model of the estimated costs of the program. -Requires that the development plan be submitted to the Department of Treasury promptly after its adoption and that it be published at least once in a newspaper of general circulation in the eligible entity (Sec. 9). -Authorizes the state to capture half of the increase in revenue in the year after the base year; the base year is referred to as the amount of revenue received from the collection of the state education tax in promise zones in the year prior to the year that the authority makes its first financial assistance payment or the amount of revenue received from the collection for the state education tax in the promise zone, whichever is less (Sec. 19). -Authorizes the Department of Treasury to oversee the actions of promise zone authorities and to assume control over an authority if it does not act in accordance with its proposed development plan (Sec. 21). -Authorizes any city, township, county, local or intermediate school district that is not an eligible entity to apply for a promise zone under this act, but specifies that such an entity shall not capture revenue from the state education tax (Sec. 23).

Full Bill Text