Michigan Governor Rick Snyder’s performance funding proposal for higher education is under fire from college presidents across the state. A key problem raised is the fact that by giving out money based on how well universities in the state have been increasing the number of graduates, the top universities with already high graduation rates don’t have equal access to the money.

The University of Michigan, for example, already graduates more than 90% of its students — but that means it’s almost impossible for them to get any new money and they’re in the bottom three for funding under the current proposal.

University of Michigan President Mary Sue Coleman said:

“You could erroneously come to the conclusion that the university is a failing institution.”

While giving schools who have demonstrated a willingness to work on low rates a boost to help them keep improving is certainly a laudable idea on paper, one can understand the frustration of some Presidents who feel they are being punished for success.

Coleman was speaking before the state House’s Appropriation Higher Education Subcommittee. She also highlighted that the proposals were particularly unfair when they had demonstrated a willing to cut costs and were performing a major role in supporting the state’s economy.

900 students in each entering freshmen class had started a business by the time they got to campus, businesses U-M helps to grow.”

College Presidents speaking before the subcommittee also criticized the fact that under Snyder’s plan universities would all be competing for the same pot of money. The plan does reward universities that keep increases in tuition under 4%, but Grand Valley State University President Thomas Haas notes that the only way to do that is get enough state aid, creating a bizarre chicken-egg situation.

“It is a fact that the single greatest impact on tuition and debt is the presence or absence of state appropriation,” Haas said. “If the state had been able to avoid cuts in the past decade, our tuition could be $6,000 a year instead of $9,000. If the state had been able to maintain the 75/25 ratio of long ago, our tuition could be just $3,000 a year, a number well within reach of nearly every qualified student.”