LANSING, Mich. – A state board has approved a $150 million emergency loan and other facets of a plan to address massive operating debt in the Detroit school district and to return control to locally elected officials.
The three-member Local Emergency Financial Assistance Loan Board OK'd the proposal Monday.
It voted to transfer assets of the Detroit Public Schools to a new district and to authorize the elimination or restructuring of debt by borrowing $235 million through the sale of bonds.
The votes effectively begin implementing a $617 million state bailout that was enacted into law in June.
Current school board members and others urged the board to reject the plan and to implement their proposed alternative. The school board technically ceased to exist July 1 when the rescue legislation took effect.
They say the laws, which allow the new district to hire noncertified teachers, are too expensive, racist, and unconstitutional.
The former board president insists the money should instead go directly to the old school district.
“We believe the state owes the district considerably more and have asked continuously for an audit,” disputed school board president Lamar Lemmons said.
The school board’s attorneys have filed suit claiming the plan violates the equal protection rights of Detroit school children because it allows the hiring of uncertified teachers in Detroit's district only.
“There is a message loud and clear they are second class citizens,” attorney Tom Bleakley said.
Alternatives submitted by the old board were considered and rejected.
"There wasn't any detail. There was just opposition to what the transition manager had proposed," Michigan Treasurer Nick Khouri said. "This is the best course of action."