School & District Management

Detroit School District Again Facing Deficit, Threat of State Action

By Dakarai I. Aarons — November 12, 2008 4 min read
  • Save to favorites
  • Print

The Detroit school system is facing a financial crisis that could lead to a takeover of its budget authority if state officials aren’t pleased with a plan to slash the budget.

Michigan’s largest district is operating with a deficit of more than $400 million in its $1.1 billion annual budget, created by a plague of long-standing financial problems, poor accounting practices, and plunging student enrollment.

The district, which this fall enrolls about 98,000 students, has crafted a deficit-elimination plan, but movement on it has not come quickly enough. The slow progress led Michigan Superintendent of Public Instruction Michael P. Flanagan to send Gov. Jennifer M. Granholm a letter, dated Sept. 17, saying the district has a “serious financial problem” as defined by state law, allowing the governor to establish a review team to examine its finances.

The decision to warn the governor came after Mr. Flanagan met with Detroit Superintendent Connie K. Calloway, members of her staff, and some school board members to discuss the district’s plan to address its deficit.

“It became apparent by the end of the meeting that they have a financial crisis,” Mr. Flanagan said last week in an interview. “The plan they submitted to me had holes in it, and wouldn’t add up to $400 million. I think they are working at it.

“This [situation] has been decades in the making, so I don’t even fault the current superintendent and board, but nevertheless it is their job to get it resolved.”

State Review Team

The state review team will work with district officials to hammer out a plan to reduce the deficit. If the district and the team can’t agree, Mr. Flanagan will then appoint a financial manager with sole authority over budget decisions.

“I’m optimistic we don’t get to that, but I need to hold that possibility out,” Mr. Flanagan said. “I wouldn’t hesitate if we can’t get a consent agreement.”

Liz Boyd, a spokeswoman for Gov. Granholm, a Democrat, said a process is under way to select the review-team members. The panel will be selected in conjunction with the president of the Michigan Senate and the speaker of its House of Representatives.

“We see this as an opportunity to help the school district get its financial house in order,” Ms. Boyd said.

In 1999, the state took control of Detroit’s schools under legislation that gave the city’s mayor the authority to appoint six school board members; the seventh was the state superintendent of public instruction. That tenure ended with a $200 million budget deficit. Voters returned to an 11-member elected school board in 2005.

Steven Wasko, a district spokesman, said Ms. Calloway, who began work as Detroit’s superintendent in July 2007, and the board take the financial crisis very seriously.

“What we’re trying to correct in the period of less than two short years is a situation that has been percolating for a great number of years, and is based on long-term trends,” he said. “It is clear to Dr. Calloway and her administration that the need to right-size the district in the instructional and noninstructional areas is simply a need that has not been met in a great number of years.”

Charters Take Students

Although the enrollment of the district has dropped by more than 67,000 since 2000, to an estimated 98,000, the teaching staff has not been reduced in a proportional way, Mr. Wasko said. The district views the state’s intervention as a boost in efforts to get the budget back in line, he said.

The district is being guided in its work, in part, by a review done by the Washington-based Council of the Great City Schools, which represents 66 of the nation’s largest urban school districts.

Michael D. Casserly, the council’s executive director, said Detroit’s problems stem from a multitude of factors, including an exodus as people have left in search of jobs, taking school-age children with them. “On top of that, the school district has had a hard time dealing with a number of students leaving for charters, and has had difficulty raising student achievement substantially enough to recapture the public’s confidence,” he said.

The district’s official enrollment, when calculated later this fall, is expected to dip below 100,000 students for the first time since World War I. If that happens, the district could lose its “first class” status under Michigan law, which defines the school board governance structure and sets rules for ethics and purchase approvals.

And without that designation, two area community colleges and some suburban districts would be permitted to open more charter schools in Detroit.

Bringing the school system’s budget into line can be done, but will require closing more facilities, trimming staff, and keeping a tighter reign on the budget, said Thomas E. Glass, a University of Memphis professor of leadership and a former superintendent in Arizona.

“State funding has been erratic at best,” Mr. Glass said. “Can it be fixed? Anything can be fixed. The question is who is going to fix it. ”

Related Tags:

A version of this article appeared in the October 01, 2008 edition of Education Week as Detroit School District Again Facing Deficit, Threat of State Action

Events

This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
School & District Management Webinar
Deepen the Reach and Impact of Your Leadership
This webinar offers new and veteran leaders a unique opportunity to listen and interact with four of the most influential educational thinkers in North America. With their expert insights, you will learn the key elements
Content provided by Solution Tree
Science K-12 Essentials Forum Teaching Science Today: Challenges and Solutions
Join this event which will tackle handling controversy in the classroom, and making science education relevant for all students.
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Student Well-Being Webinar
Stronger Together: Integrating Social and Emotional Supports in an Equity-Based MTSS
Decades of research have shown that when schools implement evidence-based social and emotional supports and programming, academic achievement increases. The impact of these supports – particularly for students of color, students from low-income communities, English
Content provided by Illuminate Education

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

School & District Management Opinion What It Takes for Universities to Conduct Useful Education Research
Many institutions lack the resources to make research-school partnerships successful, warns Thomas S. Dee.
Thomas S. Dee
3 min read
Illustration of coworkers collaborating.
iStock/Getty
School & District Management Opinion Trust Keeps Our School-Research Relationship Alive in the Pandemic
An educator and a researcher describe how their team was able to nudge forward a plan for equity even as COVID changed almost everything.
Katherine Mortimer & Scott Gray
3 min read
Illustration of coworkers analyzing data.
iStock/Getty
School & District Management Opinion The Empty Pageantry of Education Research
Educators and researchers must do their homework to defeat perverse incentives, advise Rick Hess and Mike Goldstein.
Rick Hess & Mike Goldstein
5 min read
Illustration of magnifying glass and school buildings.
James Steinberg for Education Week
School & District Management Opinion Don’t Let Education Research Languish in Academic Journals
How can we move research into the real world of schools? Scholar John Papay explains.
John Papay
3 min read
Illustration of woman using telescope.
iStock/Getty