After three years and two financial overseers, the Detroit school district achieved its first budget surplus in four years and used it to help reduce a $327 million budget deficit.
The apparent turnaround—achieved while cutting hundreds of teaching jobs and closing dozens of buildings—has set up the district as a possible success story behind Michigan’s turn to emergency managers to rescue fiscally struggling schools and municipalities.
The Detroit schools’ budget surplus of $43 million at the end of June was made possible, in part, by $98 million in spending cuts, $200 million in debt refinancing, and $54 million in additional federal revenues. The district’s deficit now is projected at $84 million.
Every teacher was laid off over the summer. Callbacks were made depending on enrollment. Last year, the district had about 4,500 teachers. The 73,000-student district now has around 4,100 teachers.
