Michigan Gov. Jennifer Granholm said Wednesday she's giving a failing grade to some Republican senators' move to eliminate the Michigan Promise Scholarship for college students.

"It will not stand," she told reporters after addressing a "Cities of Promise" conference at Michigan State University.

Republicans on a Senate appropriations subcommittee voted Tuesday to eliminate the scholarship that gives $4,000 to thousands of college students. Backers say the move is needed to save the financially strapped state up to $140 million in the budget year that starts Oct. 1.

But Granholm says the state can't end the scholarship if it's to reach its goal of doubling the number of college graduates in a decade.

"We cannot eliminate the scholarships if we are to reconfigure our state economy and to get to our goal," she said.

She added it would be unfair to end the scholarship now because parents of eligible students already are counting on getting the money this fall. About 96,000 students are expected to get a share of the funds.

Students who meet or exceed standards on each of the state standardized tests get $1,000 at the start of their freshman year of college and the same amount at the beginning of their sophomore year. Once they successfully complete two years of college or training, they get $2,000 more.

Students who don't score well enough to get the money up front, but still have valid test scores, can tap the entire $4,000 after two years. Students must maintain a 2.5 grade-point average in college to earn the money.

The state faces a general fund budget shortfall of about $1.8 billion for the fiscal year that starts in October. The projected deficit tops $2.5 billion if expected deficits in the state's K-12 schools budget are included.

Federal stimulus money will eliminate some of Michigan's budget deficit, particularly in the school aid budget, but not all of it.

That has led the Republican-led Senate to vote to slash spending. For instance, it has cut revenue sharing payments that local governments use to pay for police, fire and other services by 12 percent. The Democrat-led House also is examining cuts.

Granholm said Wednesday that the budget talks are far from finished and that there are a variety of solutions, ranging from less painful to very painful. She has suggested lawmakers end about $200 million in tax breaks she said give special treatment to certain businesses.

"There are some ... (cuts) that are extremely painful, and we saw that happen yesterday" when some senators voted to eliminate the Promise Scholarship, she said. "I think looking at loopholes is less painful, because all we're asking for is tax fairness. But obviously it's a product of negotiation."

She added that she hopes the House and Senate pass their versions of budget bills by next week so the bills can be sent to conference committees and differences worked out soon.

For the full article, see Kathy Barks Hoffman, "Gov. Granholm upset at some Republican senators' move to eliminate scholarship for college students", MLive, June 17, 2009.