The N.L. government showed during Tuesday's budget announcement that it is proceeding with plans to give Sir Wilfred Grenfell College in Corner Brook university status by earmarking $500,000 for a new governing structure.

The college is currently a campus of Memorial University, but has fought to branch off on its own.

'It's great to see that we're finally moving along the road to autonomy.'—Terry Randell, Grenfell student union head

"We will fulfil our commitment to grant Sir Wilfred Grenfell College full university status, with a separate executive, a separate senate and budget, while maintaining a common board of regents to secure a strong partnership between Grenfell and the St. John's campuses," Finance Minister Tom Marshall said.

Sir Wilfred Grenfell faculty, as well as community leaders on Newfoundland's west coast, have been lobbying for years for greater independence from Memorial.

The province announced in its 2007 budget that it planned to make Grenfell a separate university.

The debate heated up last summer when Memorial University administration spoke out against the move.

Axel Meisen, Memorial's president at the time, said then that a single university still makes sense for the entire province.

"From my perspective, the greatest concern is really the impact on students," Meisen said. "Students have repeatedly said both on our St. John's campus and our Grenfell campus that they like the ability to transfer credits and to transfer from one campus to the other."

'It's an exciting time for students'

But Terry Randell, president of the Grenfell student union, told CBC News after Tuesday's announcement that he's pleased with the move.

"It's great to see that we're finally moving along the road to autonomy," Randell said. "It's an exciting time for students. There's a little bit of unknown, but we're very happy. It will give increased opportunities for Grenfell to make a path for itself."

The province's plans for Grenfell include a new academic building and student residence.

Corner Brook Mayor Charles Pender said the extra money for the college is good news for the west-coast city.

"It will encourage more students to come to Corner Brook to study in Corner Brook, to live in Corner Brook, and hopefully encourage those students to, once they graduate, to become more integrated into our economy instead of moving away."