FY 2022-23: COMMUNITY COLLEGES
Summary: As Passed by the House
House Bill 5779 (H-3)
Analyst: Perry Zielak
Difference: House
FY 2021-22 YTD FY 2022-23 FY 2022-23 FY 2022-23 FY 2022-23 From FY 2021-22 YTD
as of 2/9/22 Executive House Senate Conference Amount %
IDG/IDT $0 $0 $0 $0 --
Federal 0 0 173,700,100 173,700,100 --
Local 0 0 0 0 --
Private 0 0 0 0 --
Restricted 431,417,000 470,028,400 518,888,200 87,471,200 20.3
GF/GP 0 0 0 0 --
Gross $431,417,000 $470,028,400 $692,588,300 $261,171,300 60.5
Notes: (1) FY 2021-22 year-to-date figures include mid-year budget adjustments through February 9, 2022. (2) Appropriation
figures for all years include all proposed appropriation amounts, including amounts designated as “one-time.”
Overview
The Community Colleges budget, contained in Article II of the compiled School Aid Act, provides funding for operational
support of the 28 public community colleges located throughout the state and some retirement costs for employees who
participate in the state public school employee retirement system. Community colleges offer a wide variety of educational
programs, including traditional two-year transfer programs, associate degrees, career and technical education,
developmental and remedial education, continuing education, and baccalaureate programs in a limited number of areas.
The colleges are supported primarily through a combination of state aid, local property tax revenue, and tuition and fees.
FY 2021-22 FY 2022-23
Year-to-Date House
Major Budget Changes from FY 2021-22 YTD Appropriations (as of 2/9/22) Change
1. Community College Operations Increase Gross $328,583,400 $22,184,800
Executive includes a net increase of $28.8 million School Aid Fund (SAF) Restricted 328,583,400 22,184,800
for community college operations, an 8.8% increase. This includes: GF/GP $0 $0
$32.4 million SAF ($16.2 million SAF ongoing and $16.2 million
SAF one-time), or 10.0%, increase to operations grants for
community colleges, which would be distributed through the
performance funding formula.
Removal of $3.2 million SAF of FY 2021-22 one-time
operations funding.
$306,500 SAF decrease based on FY 2020-21 North American
Indian Tuition Waiver program costs reported by institutions.
Projected funding increases for individual community colleges would
range from 7.9% to 14.2%. Total funding for operations would be $357.4
million SAF.
House includes a net increase of $22.2 million SAF for community
college operations, a 6.8% increase. This includes:
$25.4 million SAF increase to operations funding, allocated
based on a funding formula that allocates $3.5 million to each
institution, uses a 3-year average of fiscal year equated
students (FYES) multiplied by an established funding per
FYES measure, and a 10% cap on increases above FY 2021-
22 levels, with amounts over the cap redistributed through an
iterative process to all institutions below the cap, and a
category to ensure a 1% minimum funding increase for
community colleges below FY 2021-22 funding levels.
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House Fiscal Agency 1 5/5/2022
FY 2021-22 FY 2022-23
Year-to-Date House
Major Budget Changes from FY 2021-22 YTD Appropriations (as of 2/9/22) Change
1. Community College Operations Increase (continued)
Removal of $3.2 million SAF of FY 2021-22 one-time
operations funding.
$306,500 SAF decrease based on FY 2020-21 North American
Indian Tuition Waiver program costs reported by institutions.
Projected funding changes for individual community colleges would
range from 1.0% to 10.5%. Total funding for operations would be $350.8
million SAF.
2. Michigan Reconnect Program Gross $0 $55,000,000
House adds $55.0 million SAF for the Michigan Reconnect program, Restricted 0 55,000,000
originally funded in the Department of Labor and Economic Opportunity GF/GP $0 $0
(LEO) budget. Michigan Reconnect provides a last-dollar scholarship to
individuals over the age of 25 with a high school or equivalent diploma
seeking an associate degree or Pell-eligible skill certificate. Total funding
for the Michigan Reconnect program would be $55.0 million SAF.
3. Michigan Reconnect Program Expansion Gross $0 $148,500,000
House adds $148.5 million federal Coronavirus State Fiscal Recovery Federal 0 148,500,000
Fund for the expansion of the Michigan Reconnect program. Individuals GF/GP $0 $0
aged 21 to 24 with a high school or equivalent diploma would be eligible
for a last-dollar scholarship for an associate degree or Pell-eligible skill
certificate. Total funding the Michigan Reconnect program expansion
would be $148.5 million Gross.
4. Michigan Reconnect Program Short-Term Training Grants Gross $0 $6,000,000
House adds $6.0 million federal Coronavirus State Fiscal Recovery Federal 0 6,000,000
Fund for the Michigan Reconnect program short-term training grants. GF/GP $0 $0
Individuals at least 21 years old with a high school or equivalent diploma
would be eligible for a skills scholarship to a qualified occupational or
private training program. Total funding the Michigan Reconnect program
short-term training grants would be $6.0 million Gross.
5. Michigan Public School Employee Retirement System (MPSERS) Gross $87,200,000 $5,400,000
State Share of Unfunded Actuarial Accrued Liability (UAAL) Restricted 87,200,000 5,400,000
Stabilization Payment GF/GP $0 $0
Executive increases funding by $5.4 million SAF for the state’s share of
community colleges’ MPSERS UAAL, a 6.2% increase, due to changes
in payroll growth assumptions. The state’s share is the difference
between the calculated UAAL contribution to the system and the
employer contribution cap of 20.96% of payroll set by the Public School
Employees Retirement Act (MCL 38.1341). Total funding for the state
share of MPSERS would be $92.6 million SAF. House concurs.
6. MPSERS Offset Gross $1,733,600 $5,286,400
Executive increases funding by $5.3 million SAF for the community Restricted 1,733,600 5,286,400
colleges' MPSERS offset payment, a 304.9% increase, which assists in GF/GP $0 $0
offsetting a portion of the contributions owed to MPSERS by community
colleges. The increase would equalize the offset for community colleges
with the K-12 school district MPSERS offset. Total funding for the
MPSERS offset would be $7.0 million SAF. House concurs.
7. MPSERS Normal Cost Offset Gross $11,700,000 ($900,000)
Executive decreases funding by $900,000 SAF for the community Restricted 11,700,000 (900,000)
colleges’ MPSERS normal cost offset, a 7.7% decrease, due to GF/GP $0 $0
maintaining the current assumed rate of return at 6.8%. Total funding for
the MPSERS normal cost offset would be $10.8 million SAF. House
concurs.
House Fiscal Agency 2 5/5/2022
FY 2021-22 FY 2022-23
Year-to-Date House
Major Budget Changes from FY 2021-22 YTD Appropriations (as of 2/9/22) Change
8. Community College Academic Catch-up Program Gross $0 $10,000,000
House adds $10.0 million federal Coronavirus State Fiscal Recovery Federal 0 10,000,000
Fund for the creation of the Community College Academic Catch-up GF/GP $0 $0
program, which would be administered by the Michigan Community
College Association. Community colleges would apply for grant funding
to support various summer educational programs for students entering
college for the 2022-23 academic year. Total funding for the Community
College Academic Catch-up program would be $10.0 million Gross.
9. Michigan Center for Adult College Success Gross $0 $9,200,000
House adds $9.2 million federal Coronavirus State Fiscal Recovery Federal 0 9,200,000
Fund for the creation of the Michigan Center for Adult College Success, GF/GP $0 $0
which would be administered by the nonprofit organization Talent 2025.
The center would work on ensuring adult enrollment and completion of
college degree and certificate programs. Total funding for the Michigan
Center for Adult College Success would be $9.2 million Gross.
10. Pregnant and Parenting Student Services Gross $0 $500,000
House adds $500,000 SAF for pregnant and parenting student services. Restricted 0 500,000
Community colleges that establish and operate a pregnant and GF/GP $0 $0
parenting student services office according to the guidelines found in
2004 PA 500 are eligible for grants to operate the office.
11. Grand Rapids Community College Public Safety Training Gross $0 $100
Center Federal 0 100
House adds $100 federal Coronavirus State Fiscal Recovery Fund GF/GP $0 $0
placeholder for the creation of the Public Safety Training Center located
at Grand Rapids Community College.
Major Boilerplate Changes from FY 2021-22
Sec. 201e. FY 2022-23 One-Time Performance Funding Payment Detail – NOT INCLUDED
Details the FY 2020-21 one-time operational support payment. Executive revises language that details the FY 2022-23
one-time performance funding payment allocations for each community college. House does not include.
Sec. 206. Appropriations Payment Schedule and Reporting Requirements – REVISED
Provides for payment of appropriations in 11 installments per year to community colleges to be paid on the 16th of each
month; directs Department of Treasury to withhold appropriations if colleges fail to submit Michigan Community College
Data Inventory (MCCDI) data, longitudinal data system data, annual independent audits, tuition and fee information, and
degree and certificate award data as required. Executive deletes requirement that the state budget director notify the
legislature before withholding funds from community colleges that fail to comply with reporting requirements. House
revises reporting date from the first business day of November to November 15.
Sec. 208. Self-Liquidating Projects Restriction and Capital Outlay Requirements – RETAINED
Executive deletes language that prohibits community colleges from using state funds for construction or maintenance of
a self-liquidating project and deletes requirement that colleges comply with Joint Capital Outlay Subcommittee (JCOS)
use and finance policy for any capital outlay projects and subjects community colleges that fail to comply with JCOS
requirements to a penalty of 1% of the operations funding for each violation. House retains.
House Fiscal Agency 3 5/5/2022
Major Boilerplate Changes from FY 2021-22
Sec. 209. Transparency Website and Various Reporting Requirements – REVISED
Requires colleges to post specified information on their websites, including: annual operating budgets, general fund
revenue and expenditure projections, a listing of debt service obligations, collective bargaining agreements, health care
benefits plans, audits and financial reports, and information on dual enrollment programs and other opportunities for
earning college credit while in high school. Also requires colleges to provide current fiscal year budget information to the
state budget director. Executive deletes requirement to submit information to the state budget director. Deletes a provision
authorizing the state budget director to withhold a community college’s monthly installment payment for failure to comply
with posting specified fiscal information on a transparency website. Deletes reporting requirements around budgeted
current fiscal year revenues, in addition to reporting requirements involving career and technical programs, dual
enrollment and early middle college programs. House revises a reporting date from the first business day of November
to November 15.
Sec. 209a. Campus Safety Information and Resources Website, Safety Reporting Requirements – RETAINED
Requires community colleges to develop a “campus safety information and resources” webpage, which must be linked
and displayed on their home webpage. The page must display various safety information and policies, and the schools
must certify compliance to the state budget director or have monthly state payments withheld. Executive deletes language
that requires certification to the state budget director. House retains.
Sec. 210g. Bachelor of Science in Nursing Articulation Agreements Reporting – RETAINED
Executive deletes language that requires community colleges seeking articulation agreements with universities on a
bachelor of science in nursing to report on the summary of efforts on establishing articulation agreements with public or
independent universities. House retains.
Sec. 210h. Community College COVID-19 Vaccination Exemption Requirement – RETAINED
Executive deletes language that details exemptions and reporting requirements that community colleges must provide to
students if a campus mandatory vaccine policy is implemented. House retains.
Sec. 212. Cost Containment and Efficiency Initiatives – RETAINED
Executive deletes language that encourages community colleges to evaluate and pursue efficiency and cost-containment
measures, including joint ventures, consolidating services, program collaboration, increasing web-based instruction,
improving energy efficiency, eliminating low-volume/high-cost instructional programs, self-insurance, and group
purchasing. House retains.
Sec. 212a. Community College Operations Rainy Day Fund – NEW
House adds language that encourages community colleges to maintain a rainy day fund that equals at least 5% of the
community college's general fund operating budget.
Sec. 216. Michigan Reconnect Program – NEW
House adds language detailing that Michigan Reconnect program funds must be expended according to statutory
requirements.
Sec. 216a. Michigan Reconnect Program Expansion – NEW
House adds language detailing that Michigan Reconnect program funds must be expended according to statutory
requirements while expanding the program to include individuals aged 21 to 24; requires the Department of Labor and
Economic Opportunity to report on funds expended on a quarterly basis; and designates unexpended funds as a work
project.
Sec. 216b. Michigan Reconnect Program Short-Term Training Grants – NEW
House adds language detailing that Michigan Reconnect program funds for short-term training grants must be expended
according to statutory requirements while funding the short-term training grants to include all individuals at least 21 years
old; requires the Department of Labor and Economic Opportunity to report on funds expended on a quarterly basis; and
designates unexpended funds as a work project.
Sec. 216c. Community College Academic Catch-Up Program Detail – NEW
House adds language detailing the requirements the Michigan Community College Association must follow when
awarding academic catch-up program grants to individual community colleges through a committee review process, and
the requirements community colleges must follow when creating an academic catch-up program in order to receive grant
funding.
Sec. 220. Auditor General Performance Audits – RETAINED
Executive deletes language that explicitly authorizes performance audits by the auditor general and requires audited
colleges to report audit responses to the legislature, the fiscal agencies, the Auditor General and the state budget director.
House retains.
House Fiscal Agency 4 5/5/2022
Major Boilerplate Changes from FY 2021-22
Sec. 226b. COVID-19 Federal Funding Reporting Requir