State to take financial control of Detroit Public Schools

According to the Michigan Education Report, an emergency manager will take financial control of Detroit Public Schools following the district's failure to meet the terms of an agreement outlining how it will resolve a $400 million deficit, the Detroit Free Press reported.  

The district has 10 days to appeal the decision by State Superintendent of Public Instruction Mike Flanagan, who found that budget documents DPS officials submitted to the state were inaccurate and incomplete, according to the Free Press. The district also failed to provide the state, as required by the consent agreement, a resolution giving Superintendent Connie Calloway the authority to implement a deficit reduction plan without further involvement by the school board, the Free Press reported.

 "The schoolchildren of Detroit are being deeply affected academically by the chronic inability of the district to manage its finances," Flanagan said.

 Calloway said in a statement, "We will discuss this matter with the Detroit Board of Education and determine the appropriate next steps," the Free Press reported. Board President Carla Scott said that there was no intent not to meet the terms of the agreement.

 Flanagan said the Detroit board will continue to control educational matters, but that the emergency manager will be in charge of the budget and financial systems, according to the Free Press.

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State to take over Detroit Public Schools' finances

An emergency manager will be appointed to oversee the finances of Detroit Public Schools after the district turned in incomplete and inaccurate financial reports, falling out of compliance with a consent agreement with the state, the Michigan Department of Education said today. The Free Press reported last week that DPS filed reports that failed to list all the information mandated under the consent agreement. And State Superintendent of Public Instruction Mike Flanagan determined that budget documents DPS officials submitted to the state last week were unsatisfactory.

That led to today’s declaration of a financial emergency, and by law, an emergency financial manager will be appointed to take over all financial authority in the district. DPS has 10 days to appeal the decision.

“The schoolchildren of Detroit are being deeply affected academically by the chronic inability of the district to manage its finances,” Flanagan said. “We cannot let this continue any longer. The students’ learning and achievement are suffering because of the district’s financial turmoil,” he said.

DPS Superintendent Connie Calloway said in a statement “We will discuss this matter with the Detroit Board of Education and determine the appropriate next steps.”

Board President Carla Scott said that the concerns raised by. Flanagan will be fully investigated to determine the best course of action. “There was no intent to not meet the requirements of the Consent Agreement between the Detroit Public School District and the State Financial Management Review Team,” she said.

Flanagan said that he does not consider appointing an emergency financial manager as a state takeover of the school district because the local school board and superintendent still will operate the district’s educational matters. In 1999, when then-Gov. John Engler and the legislature passed a law to take over DPS’ operations, the school board was removed and replaced with appointees. A chief executive officer was hired who had all powers over the budget.

“The Emergency Financial Manager’s role will be to balance the district’s budget, pay its bills, manage the spending, and establish strong and reliable financial systems to help the school board make sound academic decisions for the students of Detroit,” Flanagan said.

Last Monday the DPS board approved a resolution to accept the “revised budget strategy” compiled by Superintentendent Connie Calloway’s administration. But the problem, according to MDE, is that DPS failed to submit to the state a revised Deficit Elimination Plan, “and a resolution giving the district’s Superintendent authority to implement a Deficit Elimination Plan without further involvement by the local board” as required by the state-mandated consent agreement signed last month.

MDE confirmed today that the district’s accounts payable report also did not meet the conditions laid out in the consent agreement.

Flanagan can, by law, nominate three candidates among whom Gov. Jennifer Granholm will select a manager for DPS.

Shaton Berry, president of the parent-teacher-student association at Western International High, said she has mixed feelings on the appointment of a financial manager.“Whoever has the financials, as long they have our kids' best interests at heart, is what I want to see,” she said.

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