Alarmed by a slump in college enrollment among low-income students, a broad coalition of Michigan business leaders, foundations, and college advocacy groups is recommending changes to the state’s college financial aid programs.

The proposals include a new $3,000 annual scholarship for low-income students, and incentives to nudge state colleges and universities to forgive student debt as a way to bring college dropouts back to campus.

The 16-member group, which includes the Detroit Regional Chamber, The Kresge Foundation and Skillman Foundation and the Michigan College Access Network and the Washington-based Institute for College Access and Success, recently sent a letter to the Republican and Democratic leaders of public college appropriations committees in the House and Senate outlining tweaks to state aid the coalition argued would boost enrollment that has sagged during the pandemic.

Nationwide, the number of 2020 high school graduates who enrolled in college in the fall of 2020 dropped 22 percent from the previous year, driven primarily by a decline in low-income and urban student enrollment.

As Bridge Michigan reported, first-time enrollment at the state’s four-year public universities dropped more than 7 percent between 2019 and 2020, and first-time enrollment at the state’s community colleges slumped between 8 and 10 percent.

Ferris State University saw an 18 percent drop in first-time enrollment in fall 2020; Oakland University and Northern Michigan University dropped 15 percent.

College officials had hoped the decline was a one-year, COVID-related blip, and that students who had put off coming to campus during a school year hobbled by online learning and social distancing would return this fall.

But early indications are that enrollment among low-income students may be continuing to decline from last year’s sobering figures. Applications for the Lansing Promise, which provides financial aid to Lansing students, are down 15 percent. A similar program in rural Mason County in West Michigan has seen a 10-percent drop in applications. Both programs serve largely low-income populations, and applications to attend community college and some universities at free or reduced rates is a good indication of fall enrollment trends.

“This dip could have longstanding ramifications for state and local economies as well as on the lifetime earnings of the students impacted,” the coalition wrote. The letter was sent to Sen. Kim LaSata, R-Bainbridge Township, chair of the Senate higher education appropriations subcommittee, ranking minority member Sen. Jeff Irwin, D-Ann Arbor, Rep. Mark Huizenga, R-Walker, chair of the House higher education appropriations subcommittee, and ranking minority member Rep. Felicia Brabec, D-Pittsfield Township.

Among the coalition’s recommendations:

• Create a temporary scholarship program to enable low-income students impacted by COVID to go to college tuition-free. The coalition recommends a $3,000 annual scholarship with no merit component (such as an SAT or GPA qualifying score) for low-income students who qualify for a federal low-income Pell grant and go to college in Michigan, regardless of immigration status. That scholarship would be “first-dollar,” meaning the award wouldn’t be reduced by other grants and scholarships.
• Extend the number of years Michigan high school grads can qualify for the state’s Tuition Incentive Program, which provides financial aid to low-income students whose families previously received Medicaid coverage.
• Provide incentive grants to colleges and universities to forgive institutional debt for low-income students who have been out of school for two years. One roadblock to low-income Michigan residents returning to finish degrees is debt owed to colleges for things as minor as transcript fees and parking tickets. Those debts often must be paid before students can sign up for more classes. The coalition recommends the state offer funds to colleges to help forgive those debts.

Student debt forgiveness is already taking place on some Michigan campuses. Lansing Community College recently announced a student debt forgiveness program that erases $2 million in tuition and related fees for about 3,800 former students. The students don’t have to do anything to have the debt removed. The debt is forgiven whether or not students sign up for classes again at LCC.

Similar debt forgiveness programs are springing up around the country, and at Henry Ford Community College, Oakland University and Wayne State University.

The letter to legislators does not address how much the proposals would cost the state. Group spokesperson Catherine Brown, senior director of the Institute for College Access and Success, did not return a call for comment.

There are no current bills being considered in the Legislature that address the group’s recommendations.

Senators Lasata and Irwin and Rep. Huizenga could not be reached for comment. Democratic Rep. Brabec told Bridge Michigan in an emailed statement she was “excited to see a coalition come together with concrete proposals” to help low-income college students.

“There is no doubt our state needs to do more to ensure college degrees are attainable,” Brabec said. “I am very supportive of efforts to provide additional scholarship opportunities for students with a low socioeconomic status, while continuing to look for ways to improve some of our existing scholarship programs.”