Contents of this issue:

  • Effort to expand state education authority questioned
  • School administrators, legislators criticize school aid rewrite
  • Analysts say bankruptcy more likely after Prop 1 defeat
  • Districts have trouble budgeting under MEA, AFT pension lawsuit
  • Jackson district submits school operations proposal to state

Effort to Expand State Education Authority Questioned

LANSING, Mich. – Michigan Board of Education members questioned legislative efforts to expand the Michigan Education Achievement Authority statewide, according to the Detroit Free Press.

The Free Press reports that pending bills, if passed, would formalize the EAA in state law, and allow it to operate low-achieving public schools throughout the state. According to the Free Press, the EAA currently just operates schools in Detroit.
If the EAA bills are passed, the Free Press reports, any school ranked in the bottom 5 percent of Michigan schools for three years would automatically be placed under EAA oversight.
Board members, according to the Free Press, voiced concern about the expanded role of the EAA and questioned whether it would be held accountable.
SOURCE: Detroit Free Press, “Michigan State School Board raises objections to education authority bill,” Nov. 20, 2012
FURTHER READING: Michigan Education Digest, “Private donors pay start-up costs of statewide district," Oct. 29, 2011

School Administrators, Legislators Criticize School Aid Rewrite

LANSING, Mich. – School administrators and some legislators are heavily critical of a proposal to update the way Michigan funds public education, according to The Detroit News.

Sen. Gretchen Whitmer, D-East Lansing, told The News that the rewrite is similar to a voucher proposal Michigan voters rejected in 2000. She told The News that the proposal would “…create fiscal uncertainty for every single school in the state and only succeed in lining the pockets of CEOs running for-profit corporate schools.”
According to The News, the proposal would allow more students to take online courses and to attend schools in districts that they do not live in. The News also reports that student academic achievement could be a factor in school funding.
Lansing attorney Richard McLellan, who was tapped by Gov. Rick Snyder to lead the rewrite, told The News that public school dollars would still go to public schools. “It must be a public institution,” he told The News. “You can’t take these funds and go to a private institution.” (Editor’s note: McLellan is a founding board member of the Mackinac Center for Public Policy, which publishes Michigan Education Digest.)
SOURCE: The Detroit News, “Michigan schools overhaul faces fight,” Nov. 16, 2012
FURTHER READING: Mackinac Center for Public Policy, “The V-Word,” Nov. 21, 2012

Analysts Say School Debt More Uncertain After Prop 1 Defeat

NEW YORK – After Michigan voters rejected the state’s stronger emergency manager law, analysts say school district-issued debt is more uncertain, Bloomberg Businessweek reports.

Bart Mosley, co-president of a financial research company in New York, told Bloomberg that the stronger emergency manager law was “one of the most effective pieces of legislation in the country for dealing with credit stress for local governments.”
Chris Mauro, an analyst at a different New York financial company, told Bloomberg that without the stronger law, “…all bets are off.”
It is unclear, according to Bloomberg, whether the Michigan Legislature will enact a replacement law, or allow some local governments to file bankruptcy.
“There’s a feeling that maybe we should let a couple of communities go bankrupt so they can appreciate what the process is like,” Rep. Al Pscholka, R-Stevensville, told Bloomberg.
According to Bloomberg, three Michigan school districts have emergency managers.  
SOURCE: Bloomberg Businessweek, “Michigan Vote Against Rescue Hits Local Financings: Muni Credit,” Nov. 16, 2012
FURTHER READING: Mackinac Center for Public Policy, “Prop 1 Defeat a Loss for Struggling School Districts,” Nov. 7, 2012

Districts Have Trouble Budgeting Under MEA, AFT Pension Lawsuit

LANSING, Mich. – School districts continue to have trouble budgeting for teacher pension costs, as lawsuits against recent reforms wind through the Michigan court system, according to MLive.

MLive reports that the changes to the pension system were designed to limit the amount of taxpayer money school districts would have to contribute to the teacher pension fund. However, lawsuits filed by the Michigan Education Association and the American Federation of Teachers have resulted in a temporary restraining order barring the revisions until the case goes through the appeals process.
The result of the MEA’s and AFT’s lawsuits, MLive reports, is that districts have to continue to pay a higher rate of contribution to the teachers pension fund.
According to MLive, there will be a hearing on Nov. 28.
SOURCE: MLive, “Retirement lawsuit bites into school budgets,” Nov. 20, 2012
FURTHER READING: Michigan Capitol Confidential, “Study Finds That Teacher Pension Plan Unlikely to be Fully Funded, July 17, 2012

Jackson District Submits School Operations Proposal to State

JACKSON, Mich. – The Jackson school district has submitted plans to improve two of its schools to the Michigan Department of Education, MLive reports. According to MLive, both schools may add another hour of classes each day as a result.

The two schools, Frost Elementary and the Middle School at Parkside, were both ranked in the bottom 5 percent of Michigan schools, MLive reports. The low ranking is what required the Jackson district to submit plans to improve the schools to the state, according to MLive.
The state will review Jackson Public Schools’ plan and make suggestions, JPS Superintendent Dan Evans told MLive. The district then may respond with revisions, according to MLive.
SOURCE: MLive, “School reform would add extra hours, more data-drive instruction at Jackson’s Frost, Parkside schools,” Nov. 19, 2012
FURTHER READING: Mackinac Center for Public Policy, “Why Statewide Education Policy Fails," Oct. 4, 2012