LANSING, Mich. — State Sen. Patrick Colbeck, R-Canton, announced on Thursday that he is joined by Sens. Phil Pavlov, Judy Emmons, and Mike Green in introducing legislation that enables more money for education without raising taxes.
“Many parents, teachers, administrators, and elected officials are seeking to provide additional funding for public schools in Michigan,” Sen. Colbeck said. “Some people say that it is impossible to do so without increasing taxes, but other options do exist. A key to providing more funding for schools without increasing taxes is to see how private schools do so. After all, students who go to private schools in Michigan receive no public funding. We need to explore the funding innovations practiced by these schools.”
After years of studying the issue with education stakeholders, Sen. Colbeck has introduced a suite of bills that will expand the tax exempt provisions currently leveraged through the Michigan Education Savings Program (MESP) to also include K-12 studies, vocational education and professional development.
During discussions with educators in private schools, Sen. Colbeck discovered the existence of work-study programs at Cornerstone Schools and Detroit Cristo Rey. Participating employers would provide up to $7,000 per year toward the cost of education for a student participating in the program. In exchange for five days of work per month during the school year, high school students receive valuable work experience while relieving the financial burden of attending a school that receives no public assistance. Employers are able to identify promising employees and address the growing issue of staffing gaps in Michigan’s growing economy. In order for these programs to work effectively, funding must be provided via student-specific accounts. These student-specific accounts do not currently exist for public school students as funding is transferred directly from the state to individual school districts.
Work-study programs are just the start. The legislation provides for the pre-tax contributions from any third party source to student-specific accounts which are exempt from Michigan personal income tax. This opens the door to contributions from retailer-based monetized rewards programs, family members and charitable foundations. Federal government support will be required to extend the tax-exemptions to federal income tax.
Under the proposed legislation, the services eligible for payments from the Enhanced MESP accounts would be determined by the Michigan Department of Education in accordance with the constraints of the Michigan Constitution. A likely list of eligible K-12 educational services could include things such as tutoring, band instruments, football uniforms, or out of pocket transportation expenses. Money not used for such K-12 purposes could also be used to help pay for higher education, vocational education, or professional development.
“Learning is a lifelong endeavor,” Sen. Colbeck said. “The proposed Enhanced MESP program is a great way to invest in education through all phases of one’s life. This innovative new program empowers parents and students of all ages to enhance funding for their K-12 education, lower the cost of college, promote skilled trades, and even explore career switches.”
The Enhanced MESP accounts offer a way to introduce thousands of dollars per year of additional funding for lifelong educational needs without raising taxes.
The bill package includes SBs 544-549. It is anticipated that this bill package will be referred to the Senate Education Committee for further consideration.