State Senate bills would eliminate Detroit Public Schools, largest Black district in U.S. July 1; create “Community District” including charters
Current DPS bond debt of $2.9 billion to be paid off by new property tax levies
‘Elected’ board of ‘Community District’ will answer to State Financial Review Commission, State School Reform/Redesign Office
‘Detroit Education Commission’ only advisory, gets $1M/year for making school siting recommendations; members appointed by Mayor Duggan
By Diane Bukowski
March 28, 2016
DETROIT – Bills in the Michigan Legislature which purport to “rescue” the Detroit Public Schools (DPS) district from an alleged $3.9 billion in debt that has been foisted on it under state control since 1999 would actually destroy DPS for good. The execution date is set for July 1, 2016.
DPS would be replaced by a “Community District” including charter schools attended by Detroit children. Its nine-member board be would elected this August by district, but have no real independence. It would answer to the State Financial Review Commission (FRC), which currently governs Detroit under the city’s bankruptcy plan. The FRC would appoint the Community District’s Superintendent and its Chief Financial Officer.
Under terms of the bills, which are SB 0710, SB 0711, and SB 0819, Detroiters’ school property taxes would soar to pay off $2.9 billion in current bond debt to the banks.
More public schools will close under orders from the State School Reform/Redesign Office, which has moved from the Department of Education to the Department of Management and Budget, if they are among the lowest five percent in “performance.” At least 20 to 25 schools are already on the chopping block for this year. (See website for new office at http://www.michigan.gov/sro/.)
Charter schools would be given time to correct their performance before their private authorizers close them, under advisement of a “Detroit Education Commission (DEC).” The DEC, whose board would be appointed by Detroit Mayor Mike Duggan, would recommend the “siting” of new schools.
“This would complete the disempowerment of the largest majority-Black city and the largest majority-Black school district in the country,” current DPS board member Elena Herrada told VOD.
“All we want is the same thing the white districts have for their governing structure, the power to appoint a superintendent, and decide on opening and closing of schools as well as curriculum and all policies. We urge our Detroit delegation to stand with us in restoring the governance rights of our city. We urge them to do this even if they don’t believe we can win.”
Richard Clay, a former teacher at Northwestern High School, said, “Under these bills, the future of Detroit’s school children is very bleak. It’s unnecessary as well as unprecedented to totally close a large school district in the name of helping it. The new district would be nothing but a state takeover in sheep’s clothing.”
He said he believes the final goal of the re-structured district is to completely close all public schools in Detroit, replacing them with charters, as happened in New Orleans after Hurricane Katrina.
In 2010, then U.S. Secretary of Education Arne Duncan said, “This is a tough thing to say, but let me be really honest. I think the best thing that happened to the education system in New Orleans was Hurricane Katrina. That education system was a disaster, and it took Hurricane Katrina to wake up the community to say that ‘We have to do better.’ ”
Rev. Wendell Anthony, a co-chair of the Coalition for the Future of Detroit’s Schoolchildren (CFDC), responsible for the DEC idea, responded to claims that the legislation seeks to eliminate charter schools.
In fact, it encourages opening of charter schools, 70 percent of which are for-profit in Michigan, in a city which already has the second highest number of charter schools in the nation.
“I’ve been around education reform for a long time, but I have never seen this kind of ideological truth-bending on such an important issue,” Anthony said on the CFDC Facebook page. “We’re talking about the future of 100,000 children. I wish there were referees who could blow whistles on these types of flagrant fouls, and eject dirty players.”
One hundred thousand children? DPS’ 2015 enrollment was 47,380, down from 173,000 in 1999. The Detroit charter enrollment figure for 2014 was 58,612, or 55 percent of Detroit students, the second highest number in the U.S., trailing only New Orleans, which now has an all-charter school district. http://charterschools.org/press-room/1420-december-2-2014-new-report-shows-growth-in-charter-school-enrollment-in-michigan.
An article on the CFDC Facebook page says, “The DEC is designed to make it easier for proven charter operators to enter Detroit and for existing high-performing schools to replicate. Also, any denial of opening can be appealed to the State Superintendent, who can overrule the DEC’s decision. . . .
“The facts are that Detroiters have more than 50 different school operators to choose from under 14 different authorizers – we have for-profits, nonprofits, districts … there is no shortage of choice – but there is a clear shortage of quality. The DEC would ensure families have quality choice.”
Herrada said the Coalition should be called “The Coalition for the Future of Detroit Contractors.”
The bills, which the Michigan Senate is likely to take a final vote on this week, are a devious attempt by state and city officers and religious and community “leaders” to deceive residents of the largest majority-Black city in the U.S. where 59 percent of the children live in poverty into accepting not just second, but third class citizenship.
Following are key terms of the bills, including SB 0710, SB 0711, and SB 0819. Texts of the bills are included in links below articles.
DPS DECEIT #1 (MO’ TAXES, MO’ $$ FOR BANKS)
The Detroit Public School (DPS) district would be tossed in the dustbin of history after it pays off a total of $3.4 billion in outstanding debt. That includes $2.9 billion in BOND debt paid by creating new voter-approved property tax levies. If voters do not agree to the levies, their constitutionally-required vote could be overturned by a state judgment levy.
That is because DPS currently operates under the control of state-appointed “transitional” (read “emergency”) manager Steven Rhodes, the former bankruptcy judge whose plan obliterated public ownership of the City of Detroit using the State Dictator’s Public Act 436, which has invalidated voting rights and stolen assets in Michigan’s majority-Black cities.
A Senate Fiscal Analysis of SB 710 says, “the bill would allow a district, with the approval of the State Treasurer, to issue ‘school financing stability bonds’ for the purpose of eliminating an operating deficit or refunding or refinancing outstanding State aid anticipation notes issued through the Michigan Finance Authority; to pledge as security for repayment State school aid payment, school operating tax revenue, or other revenue; and to enter into an agreement with the Department of Treasury or the Michigan Finance Authority for direct payment of school aid to the Authority or a designated trustee.”
Michigan Gov. Rick Snyder, Detroit Mayor Mike Duggan, and others have primarily discussed paying off $515 million in DPS’ current OPERATING debt, plus $250 million in start-up costs for a new “community district,” through current state per-pupil revenue over the next 10 years. In 2015, 40 percent of state per-pupil aid for Detroit went to pay off DPS debt to the banks, at one point, in 2007, it was 90 percent.
Under terms of state law, DPS cannot declare bankruptcy. Its debts are a liability of the state, including the $2.9 billion in bond debt, most of it engineered through the Michigan Finance Authority, says a recent state treasury report. The report says that if the state paid off district debts, it would cut funds available for other municipalities and school districts. As in the Detroit bankruptcy, the report puts most of the blame for $1.3 billion of the debt on DPS pensioners, who are paid through a state-run school pension fund.
This deceit is being perpetrated as 30,000 Detroit families face property tax foreclosures March 30, meaning even less revenue for Detroit and less per-pupil aid from the state (which is based on property tax revenue).
DPS DECEIT #2 (STATE REIGNS SUPREME)
The “community district” which would replace DPS would be governed by a nine-member board elected this August for initial staggered terms of three, five, and seven years, under what is being touted as a return to Detroit electoral control. Rhodes will decide a month before the election which districts get the longer terms.
On financial matters, however, the board would answer to the same state Financial Review Commission (FRC) which governs the City of Detroit under its bankruptcy plan. The community district superintendent and board chair would be added to the FRC membership as regards DPS matters, just as Detroit Mayor Mike Duggan and City Council President Brenda Jones sit on the FRC for Detroit.
“A community district is subject to financial oversight by a Financial Review Commission to the extent provided under the Michigan Financial Review Commission Act, 2014 PA 181,” Sec. 387 of Senate Bill 710 (substitute), reads. “The appointment of a chief financial officer for the community district is subject to the approval of the Financial Review Commission . . .” SB 711 says the district superintendent would also be appointed by the FRC.
The FRC would approve all school budgets, deficit plans, contracts including those with DPS workers, loans from the banks and the state, school openings and closings, and other financial matters. The Senate version of the bills do not include House provisions to replace teachers’ contractual seniority requirements with “merit,” or hire non-certified teachers, likely a concession to the Michigan and Detroit Federations of Teachers, which have endorsed the Senate package.
However, charter schools are not required to hire certified teachers, and they are not subject to union contracts with the DFT.
The current DPS, called a “qualifying school district” under the legislation, would also be subject to FRC control, and it appears likely that no current school board member could run for the new community district board.
SB 0170 reads, “a member of a school board for a qualifying school district [meaning the current Detroit district] may not also serve as a member of a school board for a community district that has the same geographic boundaries as the qualifying school district.”
Until its dissolution upon debt pay-off, the current school board’s responsibilities would consist only of “Certifying and levying taxes for satisfaction of the debt in the name of the qualifying school district, conducting school district elections, doing all other things relative to the repayment of the outstanding debt, including levying or renewing a school operating tax or refunding or refinancing debt at a lower rate, and doing all other things relative to the dissolution of the district.”
The community school district would also seize control of Detroit’s public libraries.
Wall Street is calling the shots here.
Crain’s Detroit Business reported March 10, “Moody’s Investors Service said Thursday it is keeping a negative outlook on the district’s Caa1 general-obligation bond rating, a view it said rests on the ‘challenge to remain financially viable absent state intervention and does not assume passage of any new legislation.’ That rating is seven steps below investment grade.”
But of more concern to the state are threats from Wall Street that would affect Michigan’s credit ratings. During Detroit bankruptcy proceedings, while Detroit’s ratings were in the sub-sub-basement, Michigan’s ratings soared as Wall Street cheered the bankruptcy.
“Looming financial emergencies in Flint and the Detroit Public Schools have caused Standard & Poor’s to lower its outlook on Michigan’s outstanding debt,” Crain’s reported March 18.
The S&P outlook decreased from positive, meaning future upgrades are likely, to stable, meaning the ratings of AA- for the state’s general obligation debt and its A+ rating for appropriation-backed debt will not change.
S&P credit analyst Carol Spain told Crain’s, “The revised outlook reflects our view that rising costs tied to the Flint water crisis and (DPS’) distressed financial position will limit the state’s ability to build reserves over the next two fiscal years.”
DPS DECEIT #3:
A “Detroit Education Commission” would co-exist with the community district board, primarily in an advisory role. It would make recommendations on the “siting” of new schools in the community district, with a strong emphasis on creating more charter schools, which already educate more students in Detroit than do public schools, siphoning off state per-pupil funding.
The commission would be funded by up to $1 million a year for up to 10 years.
“An education commission is subject to the leadership and general supervision of the state board over all public education,” SB 0170 reads. “An education commission may accept and retain money or other assets from any public or private source for the purposes of performing its functions and satisfying its obligations under this act and creating and providing incentives for public schools to locate in areas identified as priority zones . . .In distributing funds or assets to public school ENTITIES, the Education Commission shall not discriminate between classes of public school entities.”
Those entities include charter schools.
Detroit Mayor Mike Duggan would appoint the board of the education commission. It is to include two members with experience in running “public school academies,” (a/k/a charter schools), two with experience in running public schools, one parent of a student in a charter school, one parent of a student in a public school, and one member with “experience in public school accountability systems and school improvement.”
“The schools they are setting up are for the Next Detroit’s children,” Call ’em Out leader Agnes Hitchcock said. “The children are gone; the last twenty years of education has been like trash. What can the kids do? What do they know—uneducated as they have been by DPS under state control?”
The “education commission” is the brainchild of the “Coalition for the Future of Detroit Schoolchildren.” Herrada said the Coalition should be called The Coalition for the Future of Detroit Contractors,
The Coalition is co-chaired by the NAACP Detroit President Rev. Wendell Anthony, Skillman Foundation CEO Tonya Allen, Michigan American Federation of Teachers President Dave Hecker, Walbridge Aldinger CEO John Rakolta (a close ally of Gov. Snyder), and Detroit Hispanic Development Corporation CEO Angela Reyes.
Others represented are the Detroit Regional Chamber, Quicken Loans, Cornerstone Schools (infamous in Benton Harbor for privatizing schools there), General Motors, the UAW, DTE, New Detroit, The Boggs Center, Charlie Beckham of Mayor Mike Duggan’s office, former DPS EM Roy Roberts, current DPS board member Lamar Lemmons, State Rep. Sherry Gay-Dagnogo, and a variety of other corporations and individuals including a smattering of teachers. (Click on http://voiceofdetroit.net/wp-content/uploads/Coalition-for-the-Future-of-Detroit-Schoolchildren.pdf for a full list.)
“Any so-called progressive Black leaders supporting this legislation are traitors to our Detroit schoolchildren,” Clay said. “They’ve sold them down the drain.”
Helen Moore, leader of Keep the Vote No Takeover, said on Facebook, “Without an education that we control we still have second class citizenship. Join us at meetings for the new freedom school movement in Detroit at 11825 Dexter (at Elmhurst). Enough is Enough: a plan promoted by the governor and his racist war on our children. Anyone who supports this dismantling of our schools is our children’s enemy. You are targeted by us. Don’t run for dog catcher. You will not win even with the payoff money and promises they give you. We will post your names for all to see. It is up to us to end the tyranny.”
Shahidah Muta added, “We have always had many of our own who secretly supported what our government has always done. Importantly, many of our church leaders are in on the game too, either by their silence or becoming operators of schools themselves. I’ve always said that for this dismantling to take shape, we have plenty of feeders opening the doors for them. This dismantling has to be stopped on this end, and until that happens we are spinning our wheels.”
Jeffery Gields, a former DPS worker and activist through the last decade of attacks on DPS, had a more sinister take in his Facebook comment.
“The people are weak, lack will and sacrifice,” he said. “The Black organizations (i.e. NAACP, Urban League and others) have sold their souls to the devil.
The ‘dry run’ is complete. The state takeover of our schools, PA 436, right-to-work, pension cuts, poisoned water and the elimination of straight party ticket voting all done without one fight, skirmish, mass direct action, nor a grape being thrown reflects very poorly on the people. Next up, from the oppressors, more foreclosures, more charters, increased taxes, more redlining, more devastating legislation and eventually premature death because of stress, lack of knowledge, lack of organization and fight.”
State bills and fiscal analyses:
SB 0710 has already received a third reading and been sent to the appropriations committee. Other bills are in similar processes. Further information on them can be found on the Michigan Legislature website at
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