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Company running Highland Park schools agrees to charge less, shorten contract

The former Carstens Elementary School building, on Detroit's east side, is one of many, many schools that have been shuttered in Detroit.
Sarah Hulett
Michigan Radio
Detroit Public Schools is offering 45 schools to charter companies.

The Leona Group has agreed to run the Highland Park school district for less money, and shorten its contract. The revised contract runs only through the end of next school year, one year short of the original five-year deal.

A state-appointed emergency manager decided last week Highland Park couldn’t afford to offer high schoolnext year. Still, the charter school company that’s operated the Highland Park school district for the last three years says it’s committed to the community.

“In our three years in Highland Park we have invested, not only our time and energy but, over $1.2 million into our facilities in Highland Park. So our commitment is, I think, clear,” said Madalyn Kaltz, a communications manager with The Leona Group.

The Leona Group started running Highland Park schools after a state takeover in 2012. Student enrollment has dropped 40% since then. Kaltz says she thinks the population of Highland Park has also declined in the last few years.

“Obviously it wasn’t anticipated that the enrollment would decrease,” she said.

Kaltz says the emergency manager and The Leona Group work out enrollment projections together. Neither anticipates enrollment will decrease next year.

Kaltz says the company was “disappointed” in the decision not to offer a K-12 program, but that the revised agreement was mutual.

Kaltz listed numerous stats that show academic gains for students. She says 97% of high school seniors are graduating this year.

She says the company is “confident” in the leadership of the K-8 system, because she says they’ve gotten support from parents and dozens of community members.

“I think being new in Highland Park, this is our third year, it takes some time to get that traction and that support and I think that we really do have it in our K-8 program,” she said.

The revised contract has not been made public, although it was reportedly approved in a public meeting last week.

The new contract runs through the end of June 2016, instead of the summer of 2017.

It also changed how The Leona Group is paid. Kaltz says it will collect 10% of the school district's gross revenue.

The previous contract had the school pay the company $780,000 a year. However, the company waived its fees last year. Kaltz said it’ll only collect about $150,000 this school year.

It’s estimated the company will make roughly $400,000 next year, but it depends on a number of factors.

The revised contract also includes a deal to pay outstanding bills to DTE and Detroit’s Water and Sewage Department. Emergency Manager Don Weatherspoon said the district owes $250,000 for its water bill.

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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