School & District Management

Detroit Schools Bailout Deal Faces Resistance From Mayor, Teachers

By Corey Mitchell — June 03, 2016 2 min read

A legislative deal to rescue the debt-ridden Detroit public schools has passed the state’s House of Representatives, but faces an uncertain future.

The $600 million-plus legislative package, which now faces consideration in the state Senate, proposes sending $467 million to help pay off the district’s debt, and $150 million in transition costs to create a new debt-free district to educate students.

The old district would exist solely to collect taxes, retiring $467 million in debt over roughly 8 ½ years, the Associated Press reports.

With the district expected to run out of money by the end of June, the clock is ticking on the deadline for a new deal. The Republican-controlled Senate could vote on the package as early as next week.

“This plan saves Detroit’s school system and returns local control to the city, preventing a disastrous bankruptcy that would have affected every community in the state,” state House Speaker Kevin Cotter said in a statement. “We also included key academic and fiscal reforms to protect the massive investment by Michigan taxpayers and ensure the school district stays strong for years to come.”

Despite the looming deadline, House Democrats and the Detroit Federation of Teachers staunchly oppose the plan. The plan would force the closure of Detroit schools, opening the door for expansive charter school growth in the city.

“House Republicans are forcing the closure of public schools while allowing failing charter schools to proliferate,” House Democratic leader Tim Greimel said in a statement. “Republicans are making it clear who they serve: charter school operators, not children.”

The House plan vastly differs from a plan passed by the Senate in March that includes the Detroit Education Commission, which would be appointed by Detroit’s mayor and have some authority over public and charter schools, especially on where the schools are located in the city.

State-appointed emergency managers have run the district since 2009.

In the House-backed plan, an advisory council would produce reports on where schools and transportation are needed in the city, but their recommendations wouldn’t be binding. A school board, to be elected in November, would return the district to local control, with some state oversight of the school system’s finances. The Detroit News reports that a state-appointed transition manager would run the new debt-free district until the until the school board assumed office January.

Duggan told the Detroit News that the proposed aid package would be a waste “unless there is a commission to help stabilize the district’s enrollment and finances.”

The Senate plan, which has been endorsed by Republican Gov. Rick Snyder, received support from both parties in the Senate.

“Instead of joining us at the table to create a workable plan for Detroit Public Schools, House Republicans are once again insisting on going their own way and doubling down on ideas that are bound to fail,” state Rep. Brian Banks, the chairman of the Detroit caucus, said in a statement.

The House Republican plan would also disband the state’s Education Achievement Authority, which Gov. Snyder set up in 2012 to try to turn around the state’s lowest-performing schools. All 15 EAA schools are in Detroit, but are separate from the rest of the city’s school system.

A version of this news article first appeared in the District Dossier blog.