Detroit Public Schools Debt Was Homegrown, Not A Product of State Management

State taxpayers will be on the hook for past overspending for operating expenses of the Detroit public school district until at least 2026 as part of the $617 million bailout, according to school district officials. 

That's when the Detroit public school officials project they will have completed paying off its operating deficit in the 2016 bailout deal.

The Detroit public school district began overspending in the 2007-08 school year at a time when its enrollment was plummeting. Detroit's K-12 enrollment had fallen from 157,932 in 1999-2000 to 96,986 in 2007-08, a 39% drop over that eight-year period.

Many public school officials have blamed the state for the crushing debt the district ran up. But that’s not accurate.

The local Detroit school board, not the state of Michigan’s emergency manager, controlled the district in late 2005. At that point, the Detroit district had no operational deficit.

In the 3.5 years under board control that followed, the district accumulated operating debt that reached as high as $327.3 million in 2009-10, according to the Michigan Department of Education. In 2009, Gov. Jennifer Granholm stepped in and appointed an emergency manager and the operating deficit continued to increase under the emergency manager and hit $417 million by 2016, according to the House Fiscal Agency.