HOUSE JOINT RESOLUTION W

 

July 18, 2013, Introduced by Rep. Barnett and referred to the Committee on Tax Policy.

 

     A joint resolution proposing an amendment to the state

 

constitution of 1963, by adding section 10 to article VIII and by

 

amending section 8 of article IX, to establish the postsecondary

 

education fund, to increase the sales tax rate, to increase the use

 

tax rate, and to dedicate that revenue to the postsecondary

 

education fund.

 

     Resolved by the Senate and House of Representatives of the

 

state of Michigan, That the following amendment to the state

 

constitution of 1963, to establish the postsecondary education

 

fund, to increase the sales tax rate, to increase the use tax rate,

 

and to dedicate that revenue to the postsecondary education fund,

 

is proposed, agreed to, and submitted to the people of the state:

 

ARTICLE VIII


 

     Sec. 10. (1) There shall be established a postsecondary

 

education fund which shall be used exclusively to provide grants to

 

high school graduates for the costs of undergraduate tuition and

 

vocational training at an eligible institution, as provided by law.

 

     (2) One hundred percent of the proceeds of the sales and use

 

taxes imposed at the additional rate of 1% provided for in section

 

8 of article IX, and other tax revenues as provided by law, shall

 

be dedicated to this fund.

 

     (3) Beginning in the 2015-2016 academic year, the authority

 

shall award a grant under this section to an individual if the

 

authority determines that the individual meets all of the following

 

eligibility criteria:

 

     (a) Continuously resided in this state for at least 48 months.

 

     (b) Received a high school diploma from a school district,

 

nonpublic school, or home school located in this state or

 

successfully completed the general education development test.

 

     (c) No more than 10 years have passed since the individual

 

became a high school graduate.

 

     (d) Provides proof satisfactory to the authority that the

 

individual has done all of the following:

 

     (i) Submitted a FAFSA to the United States department of

 

education to determine the individual's eligibility for federal

 

grants or scholarships.

 

     (ii) Applied for a Pell grant.

 

     (iii) Applied for any grants or scholarships offered by this

 

state for which the individual is eligible.

 

     (e) If the individual received a postsecondary education grant


 

in the preceding academic year, the individual meets all of the

 

following criteria:

 

     (i) Earned a cumulative grade point average of at least 2.0 in

 

any undergraduate classes the individual completed at any eligible

 

institution in that previous academic year.

 

     (ii) Made satisfactory progress toward attainment of a degree,

 

as defined by the eligible institution in which the individual is

 

enrolled, since receiving the previous postsecondary education

 

grant.

 

     (iii) No more than 18 months have passed since the individual

 

earned a credit required to complete a qualified program.

 

     (f) The number of credits completed by the individual are no

 

more than the average number of credits required by public

 

universities for the awarding of a baccalaureate degree.

 

     (4) All of the following apply to the award of a postsecondary

 

education grant:

 

     (a) Not later than November 1 of each year, each Michigan

 

public university shall report to the authority the highest cost of

 

tuition for a full-time first year student enrolled at that

 

university in the immediately preceding academic year.

 

     (b) In each academic year, the base amount of the grant is an

 

amount equal to the average of the amount reported to the authority

 

under subdivision (a).

 

     (c) The authority shall determine the amount of an

 

individual's grant for an academic year by subtracting the amount

 

of any other state or federal grants or scholarships the individual

 

is eligible to receive in that academic year from the base amount


 

determined under subdivision (b).

 

     (d) The authority shall disburse an individual's grant money

 

to the eligible institution in which he or she is enrolled on the

 

individual's behalf, according to a payment procedure established

 

by the authority. The grant shall not exceed the cost of tuition at

 

the eligible institution in which the student is enrolled.

 

     (e) If there is not enough money in the fund to provide each

 

individual with a grant in the amount to which the individuals are

 

eligible in an academic year, the authority shall establish a

 

maximum grant level for the academic year. The maximum grant level

 

amount established by the authority shall reflect a pro rata

 

distribution of money in the fund in that fiscal year to eligible

 

students.

 

     (5) The postsecondary education fund shall not replace money

 

appropriated to support community colleges and public universities.

 

For each state fiscal year, the legislature shall appropriate not

 

less than 15% of the general fund to support community colleges and

 

public universities.

 

     (6) As used in this section:

 

     (a) "Academic year" means the period from September 1 of a

 

calendar year to August 31 of the next calendar year.

 

     (b) "Authority" means the authority the legislature shall

 

establish to administer the postsecondary education grant program.

 

     (c) "Eligible institution" means a degree or certificate

 

granting public or independent nonprofit college or university,

 

junior college, or community college headquartered in this state.

 

     (d) "FAFSA" means the free application for federal student aid


 

developed under 20 USC 1082.

 

     (e) "Fiscal year" means the fiscal year of this state.

 

     (f) "Full-time student" means a student enrolled in 12 credit

 

hours in an academic semester or its equivalent number of credit

 

hours in a term or quarter, as determined by the authority.

 

     (g) "High school graduate" means an individual who has

 

received a high school diploma from a high school or passed the

 

general education development diploma test or any other high school

 

graduate equivalency examination approved by the state board of

 

education.

 

     (h) "K-12 school" means a public, private, or home school in

 

this state, grades kindergarten through grade 12.

 

     (i) "Pell grant" means the postsecondary education federal

 

grant developed under 20 USC 1070a.

 

     (j) "Postsecondary education grant" means a grant awarded by

 

the authority under this section.

 

     (k) "Qualified program" means a bachelor degree, associate

 

degree, or postsecondary vocational training at an eligible

 

institution.

 

     (l) "Undergraduate class" means a class or course that provides

 

a student with academic credit applicable toward a bachelor or

 

associate degree from an eligible institution.

 

ARTICLE IX

 

     Sec. 8. Except as provided in this section, the Legislature

 

shall not impose a sales tax on retailers at a rate of more than 4%

 

of their gross taxable sales of tangible personal property.

 

     Beginning May 1, 1994, the sales tax shall be imposed on


 

retailers at an additional rate of 2% of their gross taxable sales

 

of tangible personal property not exempt by law and the use tax at

 

an additional rate of 2%. The proceeds of the sales and use taxes

 

imposed at the additional rate of 2% shall be deposited in the

 

state school aid fund established in section 11 of this article.

 

The allocation of sales tax revenue required or authorized by

 

sections 9 and 10 of this article does not apply to the revenue

 

from the sales tax imposed at the additional rate of 2%.

 

     Beginning January 1, 2015, the sales tax shall be imposed on

 

retailers at an additional rate of 1% of their gross taxable sales

 

of tangible personal property not exempt by law and the use tax at

 

an additional rate of 1%. The proceeds of the sales and use taxes

 

imposed at the additional rate of 1% shall be deposited in the

 

postsecondary education fund established in section 10 of article

 

VIII. The allocation of sales tax revenue required or authorized by

 

sections 9 and 10 of this article does not apply to the revenue

 

from the sales tax imposed at the additional rate of 1%.

 

     No sales tax or use tax shall be charged or collected from and

 

after January 1, 1975 on the sale or use of prescription drugs for

 

human use, or on the sale or use of food for human consumption

 

except in the case of prepared food intended for immediate

 

consumption as defined by law. This provision shall not apply to

 

alcoholic beverages.

 

     Resolved further, That the foregoing amendment shall be

 

submitted to the people of the state at the next general election

 

in the manner provided by law.