IF the Senate makes the mistake of letting it go to the floor; IF it then passes; and IF the Governor does not veto it; I can almost guarantee the state universities & PCSUM would take it to court.Considering that the U (including UMHS) now gets 6% of its revenue from the state (http://www.finops.umich.edu/reports/2010/pdf/UMfinrepFY10hr.pdf) I could see it finally going private, in the (highly unlikely, IMO) event it exhausted all other avenues of appeal on this issue.
I'm not sure if you're saying that you don't think this measure has a low likelihood of becoming law. Given the anti-LGBTQ legislative/judicial agenda of the state courts (e.g. second-parent adoptions) I am fairly pessimistic about the "if"s being avoided. As for U-M going private, I don't think that this issue is going to be enough to justify the U's going through the enormous transaction costs of going public to private. But maybe I'm wrong.