LANSING — In her eighth and final State of the State address last night, Democratic Gov. Jennifer Granholm announced her budget for the 2011 fiscal year would restore the Promise Scholarship and guard against further cuts to education.

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However, Granholm did not reveal specific plans for funding the scholarship’s restoration.

The scholarship was eliminated last November, when Granholm signed the final bills of the 2010 state budget. Granholm’s 2011 budget plan will be officially released next week when she submits it to the legislature for consideration.

“The choices we face in the budget are tough, but is there a single family in Michigan that would choose to make ends meet in hard times by first sacrificing the needs of the children?” she said.

The restoration of the Promise Scholarship is especially significant in light of rising tuition rates in the state and the possibility of decreasing state appropriations for higher education. In her State of the State last year, Granholm called for a tuition freeze at all public universities in the state. But as the University experienced further financial strain, the regents voted 6-2 to raise tuition by 5.6 percent last June.

Since then, budget shortages have fueled speculation and even drawn a warning from Granholm that state departments — like the Department of Education — may have to absorb a 20-percent cut in state appropriations in the next fiscal year.

In addition to discussing the restoration of the Promise Scholarship, Granholm’s speech emphasized diversifying the state’s investments to compensate for the flagging auto industry, which she said has lost 78 percent of its jobs in the last ten years.

“Our economy has changed. The old Michigan is gone,” she said. “Everything we do in these next 11 months should be linked to the economic plan we have followed these seven years: diversifying the economy, educating our people, and protecting citizens in a time of transition.”

Granholm highlighted several of the state’s job-creating forays into the clean energy industry, like Dow’s electricity-producing solar shingle, a General Motors assembly plant in Detroit that will mass-produce the Chevy Volt and companies in western Michigan that are investing in advanced battery manufacturing.

“Michigan is well on its way to becoming the hub of this new battery industry — this is where it’s happening,” Granholm said.

Granholm also asked legislators to renew the “Pure Michigan” advertising campaign — a program she said costs much less than it attracts — as part of an effort to bring more tourism dollars to the state.

In addition, Granholm announced increasing efforts to educate the state’s workforce, including an expansion of the No Worker Left Behind initiative that would open ten learning labs in Detroit and create a new training program available to 1,000 prospective entrepreneurs at small-business locations around the state.

“The businesses we want to grow in Michigan don’t just need financial capital, they need human capital too,” Granholm said.

She spotlighted Jocelyn Harris, a Detroit schoolteacher who received a $15,000 loan to begin a produce business in her community that previously lacked available fresh produce, as a model of entrepreneurship in practice.

Granholm also called on legislators to provide a tax credit to investors who make venture capital available to Michigan businesses.

After an impassioned listing of businesses that are creating jobs, a visibly emotional Granholm broke from script to thank the legislature for their service and her family for their support during her administration.

In an interview after the speech, State Sen. Tom George (R–Kalamazoo) said he was skeptical of the return of the Promise Scholarship because of Granholm’s decision to prioritize health care spending.