In March 1994, voters approved a new system for funding schools known as Proposal A. It led to three key changes:
- Eliminated the use of local property taxes as a source of school funding and created a new state education tax. School districts began to get per-pupil payments from the state.
- The state sales tax increased from 4 cents to 6 cents on the dollar. The extra two cents was to go to the school aid fund, the state budget for schools.
- Required the state’s lowest-funded school districts to receive a basic level of education funding, which raised the amount they received and significantly closed the gap between low-funded schools and others.
A very comprehensive report of Proposal A is provided by the State of Michigan here: SCHOOL FINANCE REFORM IN MICHIGAN PROPOSAL A: RETROSPECTIVE
