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Detroit Public Schools deficit grows as Lansing debates district's future

Sep 17, 2015

Credit Detroit Public Schools

The Detroit Public Schools is in even bigger financial trouble than previously thought, according to a state report filed this week.

In its June 2015 quarterly report on school district deficits, the Michigan Department of Education pegged DPS’s annual budget deficit at $166,359,414.

But in the next quarterly report, issued this week, that number had jumped to $238,239,008. The jump stemmed mostly from lower projected revenues.

Last week, DPS borrowed more than $120 million through a state finance authority for cash flow purposes, according to a district spokeswoman.

The news comes as state lawmakers are again debating the district’s long-term future.

This week, State Superintendent Brian Whiston tried to sell legislators on Gov. Snyder’s plan to radically overhaul the district and create a separate entity to pay off its debt.

That plan faces resistance from some Republican lawmakers opposed to a DPS “bailout.”

DPS has been under some form of state control for most of the past 15 years. In January, Gov. Snyder appointed Darnell Earley the district’s fourth emergency manager in six years.

The state report also highlighted 13 other school districts with growing deficits. They include: Benton Harbor, Albion, Cheboygan, Hazel Park, New Haven, and Warren Consolidated Schools.

On the positive side, 20 districts that started the school year with budget deficits are projected to eliminate them, while another 20 cut their deficits over the course of the year.