Right now school leaders around the state are looking closely at Governor Rick Snyder’s budget plan. They want to know, will the plan to help Detroit Public Schools mean they lose out on funding they need for their students?
7 Action News went to work to find out exactly where the money is coming from.
School leaders from around the state were meeting on Wednesday, discussing how the budget pan will impact their students. They voiced concerns.
They heard Gov. Rick Snyder say, “Technically, it will come from the school aid fund. But what I am proposing is that we use Michigan tobacco settlement proceeds to pay $72 million for ten years to help Detroit Public Schools address its debt and restructure.”
They asked, what does "technically it will come from the school aid fund" mean? The concern comes because the tobacco settlement money is typically used on education, medicaid, smoking prevention, and other needs. Who is going to lose? Would education overall be losing out?
7 Action News reached out to the State Budget Office. We learned the plan is to use money from a current state surplus to provide for all services that would normally use Tobacco Settlement Funds.
Tobacco Settlement Funds will be put into the school aid fund to cover aid to Detroit Public Schools.
The governor wants to make sure no schools lose out because the state is helping Detroit Public Schools succeed. He also announced a plan to provide another $50 million from the surplus this fiscal year to help the district as lawmakers work on a new plan.
“What I would say to you is this is a critical and urgent need,” said Gov. Snyder.
Lawmakers are currently looking at legislation that would back the governor’s plan to help DPS pay down debt and restructure. It would also create an old district to collect bond money to pay off debt, and a new district to educate kids. The district is facing bankruptcy if the state doesn’t intervene. If bankruptcy happens, the state would be liable for far more because it backs the district’s pensions and other liabilities.
Lawmakers from Detroit have said they have seen money talked about, but not a precise plan for how the district and academics will be reformed to ensure success after an investment.
“Who knows what the governance is going to be?” asked Sen. Coleman Young II (D-Detroit) "Who knows whether kids are going to get taught or not?”
