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Emergency manager says new arrangement at Muskegon Heights schools will be more economical

Lindsey Smith
Michigan Radio

Muskegon Heights schools’ emergency manager thinks a new setup to run the district next year will be more economical than hiring another charter company.

For the last two years, afor-profit company ran Muskegon Heights schools. But it ran into cash flow problems.The state had to give the districttwo cash advances this spring to pay staff and give it an emergency loan to keep schools openthrough the end of the school year.  

“We are in a survival mode,” Muskegon Heights schools emergency manager Gregory Weatherspoon said at a press conference Tuesday. “We will go for whatever will work and save us money and this was a cost savings to us,” he said.

"This" is a new set up where the district hires its own superintendent to run the schools instead of a management company. A staffing company will provide teachers and principals and the county’s intermediate school district will provide other services. Third-party companies will also provide busing, custodians, and food service.

It’s not clear exactly how much the new arrangement will save the district. But Muskegon Area Intermediate School District Superintendent Dave Sipka said his organization will not be looking to make money off Muskegon Heights schools.

“It means that there’s no outside management company that must turn a profit to continue the business of the school. The model truly means that the future of Muskegon Heights is firmly in the hands of local people that care about their community,” Sipka said.

Sipka says the new setup could be a model for other Michigan school districts in financial distress.

“I do want to make something very clear though. While MAISD will be providing financial services, we will not be controlling the financial purse strings,” Sipka said.

MAISD will help Muskegon Heights Superintendent Alena Zachery-Ross draft a budget. The district’s school board will approve it. Because the district is in state receivership, Michigan’s Department of Treasury will also have to sign off on the budget.

“Ultimately the (district’s charter) board will be the ones  that control the purse strings. So the success or failure of this is still going to be with the board,” Sipka said.

Weatherspoon indicated that the new plan has support from Michigan’s Department of Treasury, Department of Education and the governor’s office.

He says the arrangement works because it will allow the team that’s already in place at the school district to continue academic achievements made over the past two years.

“We didn’t fail, we had to fine tune. And in fine tuning, this is where we feel we have a seamless transition with this staff because the achievement piece was there but the money wasn’t,” Weatherspoon said.

Weatherspoon says the Department of Treasury had final say in the plan forward. He says dissolving the district was never brought up as an option under the state law passed last year that allowed cash-strapped Buena Vista and Inkster school districts to dissolve.

Instead, Muskegon Heights is getting another chance at a clean financial slate. Weatherspoon says the emergency loan wiped out any operating deficit the district would’ve racked up this school year. The $1.4 million loan will be added to an existing long-term loan from the state. It has until 2044 to pay the loan in full.

The only deficit the district may encounter would be in capital improvements. Weatherspoon believes the district will need to spend around $270,000 on repairs to bring buildings up to safety codes.

Weatherspoon says one elementary building will close next year. Pre-K through first grades will be in one building, second through sixth will be in another and the high school will house seventh through twelfth-grades.

Lindsey Smith is a Peabody Award-winning journalist currently leading the station's Amplify Team. She previously served as Michigan Public's Morning News Editor, Investigative Reporter and West Michigan Reporter.
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