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Snyder Calls For New DPS, Oversight Of Schools’ Finances, Ed Quality

May 4, 2015

Gov. Rick SNYDER today unveiled his long-awaited plan for Detroit schools, which proposes adding more oversight over Detroit education, including boards in charge of finances and educational standards.

As expected by some before today’s announcement, Snyder wants to split Detroit Public Schools (DPS) into an old and a new district. 

The existing district would continue under Emergency Manager Darnell EARLEY and the DPS Board of Education, but only to pay off the district’s debt, which Snyder put at about $483 million. 

The old DPS would use revenues generated from its existing operating millage — amounting to $72 million a year — to pay off the debt. Once it’s paid off, which is estimated to take at least six to seven years, the old DPS would go away, Snyder said. 

The new district, called the “City of Detroit Education District,” is where the rest of DPS would go — operations, buildings, and teachers and their existing contracts. 

But the state would have to help fund the new district to offset the loss of the locally-generated money going toward the debt, so up to $72 million per year. 

Snyder said there could be additional debt accumulated beyond the $483 million associated with the “transitional losses” of creating the new DPS, so it could push the potential seven-year debt repayment period even longer. 

A seven-member board of Detroit residents, initially appointed by Snyder and Mayor Mike DUGGAN, would run the new DPS. But Snyder stressed the new DPS board would return to elected officials over time, starting as early as 2017. 

“Because the state’s taxpayers are making a financial investment in the city’s schools, we have a responsibility to ensure there are financial and academic failsafes in place as the schools are transformed into a successful model,” according to an explanation provided by the Governor’s office. 

Other new entities created in the plan are two new oversight boards, both of which will likely include some Snyder appointees. 

First, there’s the Financial Review Commission, which will have oversight of finances for both the old and new DPS. This would be a different entity than the similarly named board created to oversee the city of Detroit’s finances post-bankruptcy. 

The Governor’s office did not indicate who would be on the Financial Review Commission. But Snyder policy advisor John WALSH said the commission would likely involve gubernatorial appointments because it would be created as a state commission. However, Walsh said the details could change based on the legislative discussions. 

The Financial Review Commission for the city’s finances is made up of gubernatorial appointees, Snyder cabinet officials, Duggan and Detroit City Council President Brenda JONES.

Then, there’s the Detroit Education Commission (DEC), proposed to be a five-member board jointly appointed by the Governor and Duggan. Walsh described the DEC’s job as overseeing the quality of both traditional and charter public schools in the city. 

When asked about the rationale behind instituting these appointed boards, Snyder said other urban school districts have appointed boards. 

“To make sure we can get it set up running appropriately, I view this as part of the process . . . there would be a huge investment from the state to get it set up and operating, so I think the balance between the Mayor and my role is appropriate,” Snyder said, referring to the DEC. “And I would expect that to be one of the points of discussion that will go as the legislation goes through the process.” 

The DEC would be charged with hiring a “Detroit education manager.” This person would review performance and determine timelines for bad schools to either show improvement or close. Plus, the manager would oversee a universal enrollment system. 

The DEC idea is one of a few borrowed from the Coalition for the Future of Detroit Schoolchildren and its plan to overhaul Detroit education.

Snyder thanked the Coalition for its work, but acknowledged that not all of their recommendations made it into his plan. 

“There were things we didn’t think really were appropriate for the legislative process,” he said. “They talked more about physical education, about more involvement of parents in schools. Those are all concepts that I think many of us can support, but they’re not something you’d put in a legislative package to say they should be part of state law.” 

Snyder acknowledged the Legislature would need to enact his proposed changes, including putting up the $72 million for the new DPS. 

The Governor was asked multiple times why he wouldn’t consider that a bailout. His office said the state is on the hook for most DPS debt, and any kind of default would result in higher costs for taxpayers. 

Asked once again how this couldn’t be considered a bailout, Snyder began by responding, “Before you talk about money, let’s talk about the kids,” later adding that it’s being done to “get something stable and working well.” 

The Governor’s desired timeline is to finish work on legislation this fall. He wants the DEC to get started in January 2016. And he wants the old DPS/new DPS split to become effective by July 1, 2016. 

What didn’t get much mention today was the Education Achievement Authority (EAA), which Snyder acknowledged. His office is in a holding pattern as it waits for the effective date of an executive order that moves the State School Reform/Redesign Office to the Michigan Department of Technology, Management and Budget (DTMB).

The Governor’s office also made clear Snyder wasn’t planning on turning DPS into a charter system like what happened in New Orleans. That was likely stoked because of former Louisiana state superintendent Paul PASTOREK, who has been advising Snyder on education behind the scenes.

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