FY 2024-25: COMMUNITY COLLEGES
Summary: As Passed by the Senate
Senate Bill 753 (S-2)
Analyst: Perry Zielak
Difference: Senate
FY 2023-24 From FY 2023-24
Enacted FY 2024-25 FY 2024-25 FY 2024-25 FY 2024-25 Enacted
as of 2/7/24 Executive House Senate Conference Amount %
IDG/IDT $0 $0 $0 $0 $ $0 --
Federal 0 0 0 0 0 --
Local 0 0 0 0 0 --
Private 0 0 0 0 0 --
Restricted 544,517,500 465,920,800 468,811,200 469,141,600 (75,375,900) (13.8)
GF/GP 0 0 0 1,200,100 1,200,100 --
Gross $544,517,500 $465,920,800 $468,811,200 $470,341,700 $ ($74,175,800) (13.6)
Note: Appropriation figures for FY 2024-25 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 2023-24 FY 2024-25
Enacted Senate
Major Budget Changes from FY 2023-24 Enacted Appropriations (as of 2/7/24) Change
1. Community College Operations Increase Gross $357,961,900 $8,969,900
Executive includes a net increase of $9.0 million School Aid Fund (SAF) Restricted 357,961,900 8,969,900
for community college operations, a 2.5% increase. This includes: GF/GP $0 $0
• $8.9 million SAF, or 2.5%, increase to operations grants for
community colleges, which would be distributed through the
performance funding formula.
• $49,100 SAF increase based on FY 2022-23 North American Indian
Tuition Waiver (ITW) program costs reported by institutions.
Attainment of the performance funding increase would be conditioned
on restraining in-district tuition and fee increases to the greater of 5.0%
or $241. Projected funding increases for individual community colleges
would range from 2.0% to 3.8%. Total funding for operations would be
$366.9 million SAF.
House includes a net increase of $11.9 million School Aid Fund (SAF)
for community college operations, a 3.3% increase. This includes:
• $11.8 million SAF, or 3.3%, increase to operations grants for
community colleges, which would be distributed through the
performance funding formula.
• $49,100 SAF increase based on FY 2022-23 North American Indian
Tuition Waiver (ITW) program costs reported by institutions.
Attainment of the performance funding increase would be conditioned
on restraining in-district tuition and fee increases to the greater of 4.5%
or $217. Projected funding increases for individual community colleges
would range from 2.7% to 4.8%. Total funding for operations would be
$369.8 million SAF.
Senate includes a net increase of $9.0 million School Aid Fund (SAF) for
community college operations, a 2.5% increase. This includes:
[continued on next page]
House Fiscal Agency 1 5/28/2024
 FY 2023-24 FY 2024-25
Enacted Senate
Major Budget Changes from FY 2023-24 Enacted Appropriations (as of 2/7/24) Change
1. Community College Operations Increase (continued)
• $8.9 million SAF, or 2.5%, increase to operations grants for
community colleges, which would be distributed through the
performance funding formula.
• $49,100 SAF increase based on FY 2022-23 North American Indian
Tuition Waiver (ITW) program costs reported by institutions.
Attainment of the performance funding increase would be conditioned
on restraining in-district tuition and fee increases to the greater of 4.5%
or $217. Projected funding increases for individual community colleges
would range from 2.0% to 3.8%. Total funding for operations would be
$366.9 million SAF.
2. Michigan Public School Employee Retirement System Gross $105,800,000 ($43,700,000)
(MPSERS) State Share of Unfunded Actuarial Accrued Liability Restricted 105,800,000 (43,700,000)
(UAAL) Stabilization Payment GF/GP $0 $0
Executive decreases funding by $43.7 million SAF for the state's share
of community colleges' MPSERS UAAL, a 41.3% decrease. 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 $62.1 million SAF.
House concurs. Senate concurs.
3. MPSERS Community College Payroll Cap Reduction Gross $0 $0
Executive adds $5.7 million SAF to lower community college's MPSERS Restricted 0 0
UAAL employer contribution cap from 20.96% to 20.0%. Payments GF/GP $0 $0
would be made to MPSERS through the community colleges. Total
funding for the MPSERS community college payroll cap reduction would
be $5.7 million SAF. House concurs. Senate does not include.
4. MPSERS Normal Cost Offset Gross $23,000,000 ($1,200,000)
Executive decreases funding by $1.2 million SAF for the community Restricted 23,000,000 (1,200,000)
colleges' MPSERS normal cost offset, a 5.2% decrease, due to GF/GP $0 $0
maintaining the assumed rate of return at 6.0%. Total funding for the
MPSERS normal cost offset would be $21.8 million SAF. House concurs.
Senate concurs.
5. Infrastructure, Technology, Equipment, Maintenance, and Safety Gross $32,836,600 (32,836,500)
Executive removes $32.8 million SAF of one-time funding for Restricted 32,836,600 (32,836,600)
Infrastructure, Technology, Equipment, Maintenance, and Safety, which GF/GP $0 $100
would allow community colleges to repair, improve, or maintain existing
buildings, facilities, equipment, technological and physical infrastructure,
student housing, and school safety measures. House concurs but
maintains $100 placeholder for the program. Requires individual
community college allocations to be distributed based on calculated FY
2022-23 fiscal year equated student (FYES) enrollment. Allocations
would not be distributed until January 2025. Senate concurs with House
but maintains $100 GF/GP placeholder.
6. Institutional Best Practices Incentive Gross $0 $8,920,800
Senate adds $8.9 million SAF of one-time funding for community Restricted 0 8,920,800
colleges that implement a series of best practices that include: require GF/GP $0 $0
students to participate in an institutional orientation, provide academic
pathway support and an academic course plan, establish a credit policy
and assessment based on prior learning and knowledge, adopt a co-
requisite model for remedial courses and provide the courses at no cost
to students, and require students to meet with an academic advisor once
a semester or term. Requires eligible community college allocations be
distributed based on the college's proportion of FY 2024-25 performance
funding.
House Fiscal Agency 2 5/28/2024
 FY 2023-24 FY 2024-25
Enacted Senate
Major Budget Changes from FY 2023-24 Enacted Appropriations (as of 2/7/24) Change
7. Local Heroes Program Gross $0 $850,000
Senate adds $850,000 GF/GP of one-time funding to the Michigan GF/GP $0 $850,000
Community College Association, who would administer a program to
increase the number of dual enrolled high school students and
encourage pursuit of a career in education or public safety.
8. Kalamazoo Valley Community College Internet Accessibility Gross $0 $350,000
Senate adds $350,000 GF/GP of one-time funding to improve internet GF/GP $0 $350,000
accessibility at Kalamazoo Valley Community College.
9. Removal of FY 2023-24 One-Time Appropriations Gross $15,530,000 ($15,530,000)
Executive removes $15.5 million SAF of one-time funding that was Restricted 15,530,000 (15,530,000)
included in the FY 2023-24 budget to support the following: GF/GP $0 $0
• Critical Incident Mapping ($5.0 million SAF)
• Career and Education Navigators for Adult Learners ($5.0 million
SAF)
• Michigan Reconnect Entry Point Program ($5.0 million SAF)
• Kalamazoo Valley Community College Workforce Development
Grants ($530,000 SAF)
House concurs. Senate concurs.
Major Boilerplate Changes from FY 2023-24
Sec. 205. Ordering From Businesses in Deprived and Depressed Communities – REVISED
Encourages community colleges to ensure businesses in economically distressed areas compete for and perform
contracts for services and/or supplies. Executive revises language to encourage community colleges to ensure
geographically disadvantaged business enterprises compete for and perform contracts for services and/or supplies.
House concurs. Senate concurs.
Sec. 216c. Infrastructure, Technology, Equipment, Maintenance, and Safety Appropriation Detail – REVISED
Executive deletes language that details infrastructure, technology, equipment, maintenance, safety and housing (ITEMS)
repayment categories that ITEMS funding could be used for by community colleges and language on program eligibility
and distribution of funding. House revises language to remove capital outlay project authorization as a restriction to
receiving ITEMS funding. Senate concurs with House but revises deadline to distribute lump sum payments from January
to October.
Sec. 216d. ITEMS Certification and Payment Detail – DELETED
Executive deletes language that details the certification process community colleges must complete and have approved
by the State Budget Director in order to receive an ITEMS payment. House concurs. Senate concurs.
Sec. 216e. Institutional Best Practices One-Time Incentive Detail – NEW
Senate adds language that details the institutional best practices community colleges must certify to receive a lump sum
payment. The best practices include: requiring students to participate in an institutional orientation, providing academic
pathway support and an academic course plan to new students, establishing a credit policy and assessment based on
prior learning and knowledge, adopting a co-requisite model for remedial courses and provide the courses at no cost to
students, and requiring students to meet with an academic advisor once a semester or term. Specifies eligible community
college allocations would be distributed based on the community college's proportion of FY 2024-25 performance funding.
Sec. 217b. Community College Tuition and Fee Restraint and Annual Rate Report – REVISED
Requires community colleges to report tuition and fee rates, the annual cost of tuition and fees for a 30 credit course load,
and tuition and fee increases from the prior year to CEPI by the last business day of August; details tuition restraint
requirements in order to receive performance funding for FY 2023-24; and requires community colleges to limit in-district
tuition and fee increases to 4.5% or $205, whichever is greater. Specifies community colleges that violate the tuition
restraint cap may have their appropriation adjusted. Executive revises language that limits FY 2024-25 in-district tuition
and fee increases to 5.0% or $241, whichever is greater, and limits FY 2025-26 in-district tuition and fee increases to the
greater of 5.0% or $253. House revises language that limits FY 2024-25 in-district tuition and fee increases to 4.5% or
$217, whichever is greater. Senate concurs with House.
House Fiscal Agency 3 5/28/2024
Major Boilerplate Changes from FY 2023-24
Sec. 217c. Charter School Authorizing Body Report – NEW
Senate adds language that requires each community college or tribal college that serves as an authorizing body for public
school academies to submit a report on various details on public school academies authorized by the institution, including
a list of all schools authorized; a list of any schools that closed or lost authorization; a description of new contracts for the
operation of schools performing in the bottom 5%; the academic performance of each authorized school; the total
enrollment; aggregated student enrollment data for students with an individualized education program; the total number
of fees, reimbursements, contributions or charges received; the names of the board of directors for each authorized
school; the name of the approved applicant for each school; the list of contracts and term lengths; activities to comply
with the open meetings act; and a financial report on the various revenues and expenses for the authorizing body.
Sec. 217d. Itemized Cost of Attendance Report – NEW
Senate adds language that requires each community college to provide an itemized cost of attendance report for full-time
students for the current and previous two academic years.
Sec. 228. Communication With the Legislature – RETAINED
Executive deletes language that forbids a community college from taking disciplinary action against an employee for
communicating with the legislature. House retains. Senate retains.
House Fiscal Agency 4 5/28/2024
 FY 2024-25 Community Colleges Operations Appropriations
As Passed by the Senate
% of Formula: 30% 10% 10% 10% 30% 5% 5% 100%
FY 24 FY 2023 Total FY 25
Indian Indian Indian
Total Tuition FY 2023-24 Performance- Performance- Local Tuition Indian Tuition Tuition
FY 2023-24 Waiver Base Performance- Completion Completion Contact Strategic Total Formula Waiver Waiver Waiver FY 2024-25 %
Appropriation Payment Appropriation Sustainability Improvement Number Rate Hours Admin. Value Distribution Cost Adjustments Payment Appropriation Change
Alpena $6,327,100 $26,500 $6,300,600 $47,255 $38,690 $10,639 $24,417 $24,631 $17,598 $7,876 $171,100 $21,800 (4,700) $21,800 $6,493,500 2.6%
Bay de Noc 6,299,200 113,900 6,185,300 46,390 42,558 9,922 24,688 31,667 24,899 7,732 187,900 100,000 (13,900) 100,000 6,473,200 2.8%
Delta 16,690,500 48,200 16,642,300 124,818 36,602 41,335 33,285 121,043 22,324 20,803 400,200 24,800 (23,400) 24,800 17,067,300 2.3%
Glen Oaks 2,939,000 0 2,939,000 22,043 5,878 6,475 17,494 19,322 0 3,674 74,900 1,800 1,800 1,800 3,015,700 2.6%
Gogebic 5,367,600 37,900 5,329,700 39,973 10,659 5,897 24,083 17,676 10,492 6,662 115,400 48,400 10,500 48,400 5,493,500 2.3%
Grand Rapids 20,966,400 122,000 20,844,400 156,334