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Community coalition to state: End state control, assume debt of Detroit Public Schools

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DETROIT — A group of academic, business, government and community leaders on Monday called on the state of Michigan to return control of the struggling Detroit Public Schools to its locally elected governing board, assume the district's spiraling debt and increase accountability of charter schools.

The Coalition for the Future of Detroit Schoolchildren announced its recommendations at an afternoon news conference in Detroit after a 100-day review. The diverse group of roughly three dozen committee members that includes teachers and administrators, clergy and community activists, and automotive and labor executives was formed in December. Its focus was on the state-run Detroit Public Schools, city charter schools and the Education Achievement Authority, which was created to oversee and turn around the state's lowest-performing schools. Between them, those three constitute the city's public schools.

The coalition's report says the Detroit district's "deficits and debt have ballooned" in the past 15 years, 10 of which have been under some form of state control. The state is liable for that debt, "much of it accumulated while the state was in charge," according to the report.

They were referring to $450 million raised from bond issues floated by the state, which translates to $53 million annually in debt service, or $1,120 per student a year. The coalition also recommends that the state exempt Detroit from paying the legacy cost of retired district employees to Michigan's school retirement system since "the state failed to sufficiently save to support the secure retirement of these teachers and staff and today's student population is too small to carry the expense."

John Rakolta Jr., a coalition co-chair and CEO of construction firm Walbridge Aldinger Co., said coalition members spent "thousands and thousands of hours" poring over research, holding public forums and long meetings. There were major disagreements but they ultimately resolved that a broad plan was needed to save Detroit's schools and its students, he said.

"I wasn't prepared for what I found," he said. "The system is broken and has been coming apart for a generation."

The state's intervention to date, the coalition concluded, hasn't improved the district's financial or academic fortunes. It cited a 2013 national study that found Detroit was the nation's worst performing urban district in terms of academic proficiency.

"Detroit is facing many challenges including growing poverty, a declining population and an inability to reduce fixed costs as enrollment declines," the report says. "State policies created an unfair playing field for DPS, such as the cost of paying for an expensive retirement system it did not design. ... The longer we let it fester, the more expensive the debt will become."

The group recommends creating a nonpartisan entity that oversees the district, including opening, closing and locating all schools, but allows for school decision-making such as hiring and curriculum. Charter schools also would have to meet the commission's performance standards established by what would be called the Detroit Education Commission.

The commission also wants to fully fund an office to take over the operations of the Educational Achievement Authority, assess the schools it controls and create a plan to move those schools back into the traditional district. Each of the Education Achievement Authority's 15 schools is in Detroit. The EAA has about 7,500 students.

The Detroit Public Schools have been under state oversight since 2009. State-appointed emergency manager Darnell Earley said in January that the district has a $170 million annual deficit.

Sliding enrollment has contributed to the money troubles. About 47,000 full-time students were enrolled last fall, and roughly 49,000 enrolled the previous year. About 104,000 students were in the district in 2007.

Gov. Rick Snyder said in a statement that he "respects" the coalition's work and his administration will review the recommendations. He previously had cited progress made by the school district, including in stabilizing enrollment and improving academic performance, but acknowledged "many challenges," including its finances.

Snyder's statement did not directly respond to the recommendation that the state assume responsibility for some of the debt service payments. The state did contribute along with businesses and foundations last year to a fund of more than $800 million to help Detroit soften cuts to retiree pensions.

Earley said in a statement that he and many district administrators, faculty and staff members have worked with the coalition, and he's pleased to see the recommendations support his strategy to "right our own ship."

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