Michigan Dems pass bill to erase millions in school debt 

Michigan Dems pass bill to erase millions in school debt 

Gov. Gretchen Whitmer visits with students at a public school in Michigan. (Governor Gretchen Whitmer via Facebook)

By Kyle Kaminski

November 14, 2023

Several public school districts in Michigan are set to have millions of dollars in debt forgiven as part of a budget plan that was passed this month by Democratic state lawmakers. 

MICHIGAN—A supplemental budget bill that’s headed to Gov. Gretchen Whitmer’s desk to be signed into law will forgive tens of millions of dollars in debt for five public school districts in Michigan and ultimately allow more cash to be directed toward educating Michigan students.

House Bill 4292—which was passed last week despite Republican opposition—earmarked about $114.1 million from Michigan’s School Aid Fund toward forgiving debts for public school districts in Benton Harbor, Inkster, Muskegon Heights, Pontiac, and Ypsilanti, MLive reports.

The supplemental spending bill specifically targeted districts that have been affected by financial emergencies, dissolution, or consolidation—like Ypsilanti Community Schools, which inherited millions of dollars in debt following a merger with the former Willow Run School District in 2013.

State lawmakers said that Ypsilanti Community Schools pays about $2 million annually to service its debt, and that $42.2 million included in the budget bill will allow the district to clear its debt altogether and instead redirect those resources to helping more students in the classroom. 

“For a decade, this old debt has been soaking up resources that should be going to support [Ypsilanti Community Schools] students and staff,” Sen. Jeff Irwin (D-Ann Arbor) said in a statement. “It has been a barrier to offering competitive salaries to attract and retain staff, and it has limited the district’s ability to create enhanced learning opportunities for students.”

The four other districts will also reportedly get enough funds to clear their debts. 

Here’s the breakdown:

— $31.3 million for the Muskegon Heights School District

— $18.3 million for Pontiac City School District

— $12.1 million for Inkster Schools

— $10 million for Benton Harbor Area Schools 

Marshall Public Schools is also set to receive $3 million through the legislation to support school infrastructure—either for the renovations of the existing Harrington Elementary building or toward construction of a new school building in Albion, the Battle Creek Enquirer reports

Under the bill, the school districts are required to develop plans for boosting graduation and attendance rates. Lawmakers said the funds are also set to provide tax relief for local residents who have been stuck paying higher tax rates as a result of the school district’s debt obligations.

“I am proud to be able to work with my colleagues to provide a fresh start for our students and our community,” state Rep. Jimmie Wilson Jr. (D-Ypsilanti) said in a statement. “Democrats in Lansing have delivered debt relief for YCS and disproportionately impacted local districts across the state.”

In a statement, the Michigan Legislative Black Caucus applauded state lawmakers for prioritizing debt for multiple urban communities. State Rep. Brenda Carter (D-Pontiac) also said the funding marks a “fresh start” toward turning Michigan schools into a “world-class” system.

“We continue to make significant progress towards providing the best opportunities possible for our local elected leaders to lead unencumbered,” Carter said in a statement last week.

The supplemental funding for Michigan schools was part of a broader, $615.6 million spending plan that was passed last week by the state Legislature and is expected to be signed into law. 

More than a third of the total appropriation—about $234 million—is funding from the Federal Highway Administration that will be used for state trunkline road and bridge construction, Michigan Advance reports. Another $85 million in the bill was reportedly earmarked for Grand Valley State University, Grand Rapids Community College, the Grand Rapids Home for Veterans, and to support ongoing efforts to replace water service lines in Highland Park.

Michigan State University also received $57 million to renovate its greenhouses and dairy facilities; $66 million was earmarked for a new state environmental science lab in Lansing; and $51 million will support the construction of a new state psychiatric hospital complex in Northville.

The budget bill also includes $6.5 million to get the new Michigan Department of Lifelong Education, Advancement, and Potential up and running, as well as $250,000 to research a potential state paid family and medical leave program, Crain’s Detroit Business reports

READ MORE: 8 ways the new state budget is investing in Michigan’s public schools

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Follow Political Correspondent Kyle Kaminski here.


  • Kyle Kaminski

    Kyle Kaminski is an award-winning investigative journalist with more than a decade of experience covering news across Michigan. Prior to joining The ‘Gander, Kyle worked as the managing editor at City Pulse in Lansing and as a reporter for the Traverse City Record-Eagle.

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