In an attempt to encourage college graduates to stay in Michigan, state Sen. Glenn Anderson (D–Westland) has sponsored a bill that will offer a tax credit worth up to 50 percent of the amount paid on student loans for students who agree to remain in Michigan after graduation. Besides a tactic to help combat the rapidly increasing student-loan debt, the bill is aimed to prevent the outsourcing of Michigan’s educated youth. While the program’s costs may seem overwhelming, the benefits gained from retained talent and creation of industry could revitalize the state’s economy.
Anderson’s Senate Bill 408 has the potential to have widespread effects. The financial burden that student loans impose on individual college students would be lifted — not only for current students, but also for future students who may have avoided a traditional four-year degree after considering the hefty price-tag. With college tuition in the United States having risen more than 300 percent since 1990, discouraged prospective students have not been a surprise — even more so in Michigan, where tuition has increased by 23.1 percent since the 2008 academic year alone. The bill’s goals are also directed toward diminishing the financial woes of the entire state, including Detroit. By allowing Michigan graduates to consider the benefits of reducing their student loans, the program would lead to an increase in a young, skilled and educated population. Prevention, or even mitigation, of Michigan’s “brain drain” would further contribute to a growing accumulation of an educated workforce during Michigan’s period of revival.
Despite the nature of the legislation proposed being largely optimistic, its impacts need to be further developed and refined. The proposed cost totals more than $300 million. To ensure the program’s costs will be ultimately covered by returns on the investment, the bill will need to incentivize students to settle in Michigan long-term. Furthermore, while the bill may be able to convince graduates to stay and work within the state, jobs need to be available for these students. As a preventive measure, the gradual distribution of tax credits may prove to be an indicative approach as to whether retained graduates would be benefitting from the Michigan employment market.
This bill aims at the right demographic to improve Michigan’s future. The increase of tuition and subsequent increase of student loans has paralyzed a generation of students now unable or, at the very least, unwilling to remain in Michigan post-graduation. As students follow their classmates out of state to seek better opportunities, this bill seeks to keep them here or even bring a few back.