Action plan awaited
But the Republican governor said last week he’s open to having the state assume the $53 million in annual debt payments DPS makes on money borrowed by past state emergency managers to keep the 47,238-student school system afloat.
“With respect to debt, that’s something where we would have to carefully consider, and really not look at bailouts per se, but to say if it’s helpful for long-term sustainability, we need to be open-minded,” Snyder said Tuesday.
Snyder’s proposed 2016 budget plan includes a $75 million fund for distressed schools. But House and Senate committees have reduced the amount to $4 million and $8.9 million, respectively, until they hear a plan of action from the governor.
Sen. Dave Hildenbrand, chairman of the Senate Appropriations Committee, said he has “serious reservations” about carving out a special account in the $12.5 billion School Aid Fund to cover Detroit school debt.
“It goes beyond Detroit. We’ve got issues all across the state,” said Hildenbrand, R-Lowell. “I’m uneasy about pouring more money into a failing system. … I don’t think we can just say we can accept that responsibility.”
Even with DPS falling behind on pension payments and running up a projected $166 million deficit this fiscal year, the governor is discouraging “speculation” about whether DPS should follow the city of Detroit through a Chapter 9 bankruptcy reorganization.
“I don’t look at bankruptcy as really an option for the Detroit Public Schools,” Snyder said.