Lawmakers still aren’t showing much enthusiasm for the bills that would send millions of dollars to Detroit Public Schools and create a more stable foundation for the district’s future. To get legislative support, Gov. Rick Snyder plans to tap retired U.S. bankruptcy judge Steven Rhodes to serve as interim emergency manager for Detroit schools.
Rhodes, the judge who oversaw the city of Detroit’s bankruptcy, is well respected in Detroit and Lansing. And he’s already spent some time with lawmakers at Snyder’s request, educating them about the precarious nature of DPS’ finances and the potential negative consequences of the school district going bankrupt.
According to a source close to the negotiations, Snyder could announce as early as Friday that Rhodes will accept the appointment as emergency manager.
Current DPS Emergency Manager Darnell Earley announced a few weeks ago he would resign Feb. 29, so Snyder must appoint another manager to oversee the district through June, when Earley’s 18-month term was up.
Earley was pressured to step down given his tenure in the same role in Flint, during which time the city moved to Flint River water. In addition, Detroit teachers have brought unsanitary building conditions to light in recent weeks, which reflected poorly on Earley.
The governor is counting on lawmakers to pass legislation by this summer that would send DPS $700 million over 10 years and turn the district back to an elected school board. That election could happen as early as August. But it all depends on the Legislature.
Rhodes has said he sees this role as short term, and he is not open to serving as EM past July — regardless whether lawmakers act on the DPS bills by that time.
While Rhodes’ involvement should signal to lawmakers that bankruptcy is definitely on the table, he personally would not be able to take the district into bankruptcy if that’s what the state decides to do. His time as a bankruptcy judge would likely preclude him from overseeing a district bankruptcy.
The legislation currently before lawmakers would split DPS into an “old company” to pay down past debt and a “new company” that would form a debt-free school district for the 46,000 students who attend DPS.
The governor wants Rhodes on board to get the new district ready to go, which would include hiring an interim superintendent to oversee academics until an elected school board would hire a permanent one.
Rhodes’ appointment should instill more faith in the governor’s plans for DPS — at least that’s Snyder’s hope.
Last week, in his budget presentation for 2017, Snyder again reiterated his financial plans for Detroit schools. But this time, he suggested the bailout money should come from the Tobacco Settlement Fund. This would shield the School Aid Fund from taking a hit, and it’s likely to garner more lawmaker support.
The governor also requested a $50 million supplemental appropriation in this year’s budget to help DPS avoid insolvency.
That’s a sign that Snyder would prefer a legislative solution to bankruptcy.
With Rhodes on board, lawmakers should have more confidence that plans for DPS are in good hands. And waiting longer holds no financial benefit for the state.