Michigan says 55 school districts have deficits

A record-high 55 Michigan school districts are operating with deficits, though this year's final tally of financially troubled districts could drop below last year if 10 get back into the black as expected this summer.
AP Wire
Jun 7, 2013

 

The state's update to lawmakers was closely watched Thursday because of a number of recent school developments across Michigan.

Buena Vista School District near Saginaw was forced to shut its doors for nearly two weeks after running out of money to pay teachers. Albion Public Schools between Jackson and Battle Creek decided to close the high school next school year. The Pontiac School District is headed toward a financial emergency that could result in the appointment of a state manager.

Three districts already are being overseen by managers.

State Superintendent Mike Flanagan told legislators on K-12 budget panels that most of the state's 549 districts plus 278 charter schools balance their budget every year. Some local school boards just do not want to make tough decisions in the face of declining enrollment, he said.

Since peaking at 1.7 million in 2002-03, K-12 enrollment has dropped every year since and has decreased 177,000 overall. In the same time, the number of deficit districts rose from 10 to 49 at the end of the 2011-12 school year.

The state should have a final count of deficit districts for this academic year by late fall. Districts with $1 million-plus deficits are projected to rise from one a decade ago to 30 at the close of this school year.

Flanagan said Michigan should consider moving to countywide school districts like in other states, under the theory that larger entities could better handle fluctuations in enrollment and funding without drastic impacts that hit districts with no ability to bounce back. But he doubted countywide districts are on the horizon.

Sen. John Pappageorge, a Troy Republican, urged Flanagan to be more proactive if he thinks changes should be made.

"When you say you can't do something because of the law, you have to take some responsibility for doing something to say the law's wrong," said Pappageorge, lamenting that Lansing "is full of critics and we need playwrights."

Pappageorge said his home county of Oakland in suburban Detroit has more people than 11 states and a countywide district would not work well there but perhaps it would in more rural areas.

"Just do it and give us a shot at trying to help you when you present it to us," he said.

But Rep. Terry Brown, a Pigeon Democrat, said consolidating districts is not necessarily the answer.

"Oftentimes we lose things in bureaucracy. It's good to have competitive districts with charters or schools of choice," he said. "Are we bettering it for kids or are we making our job as state legislators easier by closing schools?"

Flanagan, who also said schools need more funding, endorsed the concept behind newly introduced legislation that could be on the fast track before the Legislature's summer break. It would give the state superintendent and state treasurer the authority to dissolve districts that do not submit deficit-elimination plans or submit proposals deemed inadequate.

Students would go to other area schools.

Flanagan complained that he got heat for Buena Vista staying closed so long when the state Education Department's hands were tied by the law.

Asked about the number of deficit districts Thursday, Republican Gov. Rick Snyder blamed dropping enrollment and bad financial planners in some districts. He agreed that longer-term school funding issues should be discussed in the next few years but questioned why districts such as Ann Arbor built new high schools knowing negative demographic trends.

He did not rule out talking about a shift to countywide school districts.

"We have over 500 school districts in our state and we have a large number of (intermediate school districts)," Snyder told reporters. "Are there better ways we can partner together?"

 

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