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Private schools receive millions in PPP loans from federal government

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Posted at 6:40 PM, Jul 08, 2020
and last updated 2020-07-09 08:43:27-04

(WXYZ) — As state leaders sue the U.S. Education Secretary to stop her from sending CARES Act money to private schools, the 7 Investigators have learned that several local private schools have already received millions of dollars from the federal government.

When the coronavirus shut down the economy, private and independent schools across the country saw the writing on the chalkboard: parents who lose jobs won’t be able to afford tuition, which means private school funding could plummet.

“We’ve got a lot of parents that are hurting financially, a lot of parents have been unable to make their full tuition payments, a lot of requests for refunds and discounts,” said Andrew Guest, Head of School for Notre Dame Preparatory School and Marist Academy in Pontiac.

Notre Dame Prep is one of several local private and religious schools that applied for CARES Act funding through the Payroll Protection Program, or PPP.

“For us I would describe it as 100% necessary,” Guest said.

Guest says they were approved for a loan of just over $2 Million, but they returned some of the money. Ultimately Notre Dame received about $1.7 Million that the school used to pay all of their teachers and coaches.

“If we had to do even a small reduction in staff it would have been devastating for those families. Our teachers count on us to look out for them, and make sure they get paid on a regular basis, they have families, they have little children too,” Guest said.

Guest says Notre Dame relies solely on tuition and fundraising for revenue, and without the ability to fundraise with social distancing restrictions, the school needed help.

“We have 38 students from the city of Pontiac here on 100% scholarship. These are students that have all the potential to succeed at a high-powered academic institution, but no resources to do so. So when the community hurts and people hurt, that impacts us and it impacts our ability to help the community around us,” Guest said.

Guest says Notre Dame does not have a large endowment for times of emergency like some private schools.
It’s less clear why schools that do have those endowments still needed federal funding.

The Detroit Country Day School charges between $24,000 and $33,000 for tuition, yet the school was approved for PPP loans totaling between 2 and 5 million dollars.

In a statement Rich Dempsey, Head of School, said, “Like many of our peer schools, Detroit Country Day School applied for PPP funds. These funds are not part of any Federal Title 1 programs. The PPP funds we received ensured our full faculty and staff's retention, including hourly employees, during this very challenging and uncertain time. We feel fortunate to have received the funds to continue to support the DCDS employees.”

Here are some other local private schools that were approved for PPP loans. The information from the U.S. Treasury Department does not indicate the exact amount the school used, just the range for which they were approved:
University Liggett School $2-5 Million
The Roeper School $1-2 Million
Academy of the Sacred Heart $1-2 Million
Farber Hebrew Day School $350,000-$1 Million

There’s a whole separate legal battle that’s now brewing over a different pot of CARES Act cash for schools. Gov. Gretchen Whitmer and Michigan Attorney General Dana Nessel announced Tuesday that the state is trying to keep that money from going to private schools.

According to the U. S. Education Department, private schools that got PPP loans could still be eligible for some of that money for low-income students.

Additional Coronavirus information and resources:

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