Proposal for Lansing to forgive DPS debt needs more talk
Published: October 20, 2010
Detroit Public Schools Emergency Financial Manager Robert Bobb's basic proposal to have the state forgive the district's $332 million debt isn't necessarily possible, Gov. Jennifer Granholm told a local radio station.
"We can't legally forgive debts," she told Paul W. Smith on WJR-AM 760 last Friday.
But Lansing is interested in hearing what deal Bobb will propose for district reform — based on the federal "Race to the Top" program — in exchange for financial help with its mounting deficit, she said.
"I'm absolutely in favor of not having the district being beholden to paying off its debt so that it can't do the dramatic changes it needs to make. Certainly that's very intriguing and we've talked a lot about that," Granholm said, speaking from France, where she was recruiting foreign companies to relocate to Michigan. "It would require a lot of reforms that have to be made and I don't think that anybody in Lansing would be interested in any district just forgiving debt without significant strings attached including significant reforms."
As Metro Times reported Oct. 13, Bobb planned to ask Michigan lawmakers to forgive or fund the district's $332 million (and growing) debt in exchange for major restructuring of the district's administration and operations.
Bobb is scheduled to present his plan "related to deficit districts in general" to Granholm and the governor-elect on Nov. 15.
District spokesman Steve Wasko says the district looks forward to making that presentation. Until then, the district is "just doing the heavy lifting of drafting the plans," he says, and working on the details of how the debt could be legally repaid or forgiven.
Granholm declined to provide any details of the plan on Smith's morning show. "Out of respect for him and that plan I want him to be able to present it when the time is right," Granholm said.
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