A news service for the people of Michigan from the Mackinac Center for Public Policy

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Teacher Layoffs Not Caused By Lack of Cash

Emergency managers working to eliminate long-running deficits, improve school districts

Teachers in three financially troubled school districts don’t know if they will have jobs this fall, the Associated Press has reported

The story highlighted the districts of Muskegon Heights, Highland Park and Detroit because they are run by emergency managers. Muskegon Heights and Highland Park are being turned into charter schools.

But those three districts found themselves near “financial ruin” not because of a lack of spending.

For example, in 2010-11 Highland Park spent $19,634 per-pupil on operating expenses to top the state in spending. Detroit was the fifth-highest spending district at $15,884 per-pupil. And Muskegon Heights was the seventh highest spending district at $15,135 per-pupil.

By comparison, the Bendle School District was the lowest-spending at $6,331 per-pupil.

Despite the high spending, those three districts were among the 48 in the state that were in deficit for 2010-11.

The three districts have a history of not being able to stay within budget. Muskegon Heights had run a deficit for five consecutive years, Detroit Public Schools had been in the red for six straight years and Highland Park had been in deficit for five straight years.

Michael Van Beek, education policy director at the Mackinac Center for Public Policy, acknowledged that teachers not knowing their fate can be a concern.

But without an emergency manager, Van Beek said, “the alternative is … these districts go bankrupt and none of these teachers keep their paychecks or jobs.”

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See also:

Bloated Teacher Contracts Much To Blame For Issues In Highland Park, Muskegon - Unsustainable union contract benefits included 100 percent insurance coverage, up to 95 paid sick days and more

School District: Spending Up, Revenue Up, Red Ink Up — Wants More Money - Highland Park blames governor, Legislature for fiscal problems

Overhaul Of Highland Park School District On The Horizon

Highland Park Schools Get State Bailout — Already Receive $14,000 Per Student

Northern Michigan University economist Hugo Eyzaguirre discusses how raising the minimum wage will hurt emerging local economies. See more at "Raising the Minimum Wage, Lowering Opportunity."


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