News Story

Don’t Forget The Other Taxpayer Dollars Detroit Schools Collect: Debt Relief

Two legal entities, one created by a state bailout to repay old debt, the other to operate classrooms

Media voices and advocates for higher spending by Michigan’s public schools have been saying school districts that serve cities like Detroit are not as well-funded as ones serving more affluent communities.

But if money from all school revenue sources is included in the total, the public school district serving the city of Detroit is one of the best-funded in the state.

The rebranded Detroit Public Schools Community School District that emerged from a 2016 state bailout receives total revenue of $17,379 per pupil from local, state and federal sources.

By comparison, the state average was $16,322 per pupil. And it is not unusual to see public school districts that serve affluent areas like West Bloomfield get less. - It received $15,723 per pupil in the 2019-20 year.

But even these figures do not capture the full amount of taxpayer dollars going to support public schools in Detroit.

As part of a 2016 state bailout of an illiquid Detroit school system that could no longer cover its bills, the Detroit Public School district was split into two separate entities. One of these, the Detroit Public Schools Community District, operates the schools.

The other, the original Detroit Public Schools, now exists for the sole purpose of collecting local property tax revenue. It uses that money to pay off the unsustainable debt accrued by the school system over many years.

In three years from 2017-18 to 2019-20, the Detroit Public Schools district has collected $515.3 million to pay that accumulated debt, or about $171.7 million a year.

That means that taxpayers are paying around $3,400 per pupil to the old school district — not to educate children, but to cover spending made years, ago using borrowed money.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

News Story

Schools Serving Michigan’s Poor Cities Get More Taxpayer Dollars, Not Less

Benton Harbor schools received twice as much per student in 2019-20 as those serving its affluent neighbor St. Joseph

A recent article about the $6 billion in federal COVID funds Michigan’s public schools are getting suggested that the poor fiscal and academic performance records of Benton Harbor’s school district are due to inadequate funding.

Published by the Michigan arm of a national nonprofit called Chalkbeat, the article referred to the Benton Harbor district as "cash-strapped," and quoted an official saying it didn’t have money previously to provide expanded summer school programs.

Chalkbeat Detroit is not alone in portraying school districts in Michigan that serve poor communities as poorly funded. But the claim is not accurate, based on school funding data.

Benton Harbor Area Schools received $17,006 per pupil in total funding in 2019-20. This includes money from taxpayers at the local, state and federal levels. The average amount of revenue for operations received by Michigan public school districts in that year from all sources was $16,322 per pupil.

One of those sources of revenue is called the general fund. Benton Harbor received twice as money on a per-pupil basis than schools serving the far more affluent neighboring city of St. Joseph in 2019-20.

Benton Harbor Area Schools received $20,884 per pupil in general fund revenue in 2019-20, while St. Joseph Public Schools got $9,675. The statewide average was $10,687.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.