Michigan school officials yesterday declared Detroit Public Schools in a state of fiscal emergency and said they would appoint a manager to take over the district’s finances.
The move comes after DPS officials failed to submit an adequate revised plan for eliminating a $400 million deficit as required under a recent consent agreement with the state, said Mike Flanagan, state superintendent of public instruction.
“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,” said Flanagan in a statement Monday.
The state’s largest school district, DPS had about $1.67 billion in outstanding debt as of fiscal 2006.
Flanagan will nominate three candidates to Gov. Jennifer Granholm, who will select the fiscal manager in the next few weeks. DPS and Detroit school board officials will continue to have control over educational matters.
DPS has 10 days to contest the order, according to reports. School officials on Monday said they planned to meet with the Detroit Board of Education to determine the next step. “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,” board president Carla D. Scott said in a statement.