Detroit Proposal S (2009)

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Detroit Proposal S is a bond referendum on the November 3, 2009 ballot in the City of the Detroit. The proposal asks the City of Detroit to approve $500.5 million dollars in bonding for new facilities and capital improvements in the Detroit Public Schools. This is the first school bond referendum for the City of Detroit since 1994.[1]

Purpose

Detroit Proposal S comes in response from the City of Detroit being awarded money from The American Recovery and Reinvestment Act of 2009 to modernize school facilities. The City of Detroit received the sixth largest allocation of school bonds made available from ARRA out of other large metropolitan school districts in the United States[2].

The project according to the Detroit Public Schools would build ten new facilities and renovate eight existing ones in the district. The project would also allow for school facilities to have new security and safety infrastructure along with using decommissioned facilities to be re-tailored as community centers.[3][4]

Project details

Schools considered under Proposal S

The ballot question if authorized by the voters would allow Detroit Public Schools to build eight new schools and modernize 10 schools. Current school facilities in the City of Detroit that are recommended for improved or new buildings if Proposal S is approved are:

  • Bethune Academy-Modernize current facility
  • Brightmoor PK-8 School-Build new facility
  • Chadsey High School-Build new facility
  • Cooley High School-Build new facility
  • Denby High School-Modernize current facility or build a new facility
  • Duffield PK-8 School-Modernize current facility
  • Finney High School-Build new facility
  • Henry Ford High School-Modernize current facility or build a new facility
  • JR King-PK-8 School-Modernize current facility
  • Marcus Garvey PK-8 School-Modernize current facility
  • Mark Twain PK-8 School-Modernize current facility
  • Martin Luther King, Jr. High School-Build new facility
  • Maybury PK-8 School-Build new facility
  • McNair PK-8 School-Build new facility
  • Mumford High School-Build new facility
  • Munger PK-8 School-Build new facility
  • Northwestern High School-Modernize current facility or build a new facility
  • Western International High School-Modernize current facility or build a new facility[5].

Project funding and impact

Project criteria

Here is the criteria the Detroit Public Schools used in determining which schools would be considered for new construction or improvements:

  • Academic Performance-If a school is meeting the Adequate Yearly Progress standards set by the Michigan Department of Education and the State of Michigan report card for school performance[6].
  • Utilization-Using a student per square foot formula to determine how well utilized or under utilized facilities are.
  • Demographics-Factors such as population migration and survival of cohorts a ratio used to determine enrollment attrition[7].
  • Facility Condition-Inspections/site visits with Michigan Department of Education, US Department of Education.
  • Building Age-Using the average weighted building age formula as a key benchmark[8].
  • Past Investment-Takes into account what capital improvements happened in past 10-20 years.
  • Building Needs-Anticipated building needs for the future[9].

Project costs

The construction projects will be funded by two sets of bonding. The first set is $246,540,000 authorized by ARRA with zero interest[2]. The bonds are made part through the Qualified School Construction Bonds program which is in ARRA. The bonds must be spent in three years and has a fifteen year maturity rate.

The second set of bonds is $254 million in build America bonds. Build America bonds are issued through the federal government and offer a federal government rebate on taxable interest paid. Detroit Public School official say this would reduce their cost of borrowing. The bonds must be spent in three years like the stimulus funds, but have double the maturity rate of 30 years[10].

Proposal S is designed to extend the current mill levy rate for the Detroit Public Schools and to not increase taxes[11].

Economic impact

According to the State of Michigan job impact formula, Proposal S would bring 3,725 direct jobs and 7,000 indirect jobs totaling over 10,725 jobs created if proposal S is approved with construction beginning in 2010[11]. Detroit Public Schools say that the project would be the largest public works project in the City of Detroit if approved by the voters[11].

Text of measure

The official ballot question language for Detroit Proposal S is as follows:

Shall the School District of the City of Detroit, County of Wayne, Michigan, borrow the principal sum of not to exceed Five Hundred Million Five Hundred Forty Thousand Dollars( $500,540,000) and issue its unlimited tax general obligation bonds for the purpose of defraying the cost of:

  • Constructing new replacement buildings and/or additions to existing buildings;
  • Remodeling existing buildings, including energy conservation, safety and security improvements;
  • Acquiring, improving and developing sites, including playgrounds, playfields and outdoor athletic facilities in the School District;
  • Furnishing, refurnishing, equipping and reequipping School District buildings; and
  • Acquiring and installing instructional technology equipment in and connecting School District buildings?


___ YES
___ NO

The estimated millage to be levied in 2010 to service this issue of bonds is 3.82 mills ($3.82 per $1,000 of taxable value) and the estimated simple average annual millage rate required to retire the bonds of this issue is 2.56 mills ($2.56 per $1,000 of taxable value). The debt millage levy required to retire all bonds of the School District currently outstanding and proposed by this ballot proposal is currently estimated to remain at or below 13.0 mills. The bonds may be issued in multiple series, payable in the case of each series in not to exceed thirty (30) years from the date of issue of each series. If the School District borrows from the State to pay debt service on the bonds of this issue, the School District may be required to continue to levy mills beyond the term of the bonds to repay the State. (Under State law, bond proceeds may not be used to pay teacher or administrator salaries, routine maintenance or repair costs or other School District operating expenses.)[12].

Election result

Detroit Proposal S
Result Votes Percentage
Approveda Yes 72,520 62%
No 47,329 38%
Total votes 119,849 100.00%
Voter turnout 0%


Sources: ABC 7 Detroit

Comparison to 1994 ballot question

Breakdown of money spent in 1994 bond referendum

In 1994, voters in the City of Detroit approved three times the amount of what is up for voter approval in 2009. The voters in Detroit approved $1,576,546,000 for multiple projects in the Detroit School District[13]. The 1994 proposal allowed the district to build three new high schools, renovated 2 other high schools, and built 16 other school facilities. The proposal allowed for $600 million in capital improvements to over 175 schools within Detroit Public Schools. These improvements included bathroom and kitchen upgrades, lighting and electrical improvements, athletic facilities, and wiring for the internet[13].

As of 2009, 14 schools that had projects approved in 1994 have either been closed or consolidated as part of the current Detroit Public Schools restructuring plan[14]. Also, some projects that listed under the 1994 referendum were canceled[14]. Out of the $1.5 billion approved by voters in 1994, over 86 percent of the funds went to either building new schools or improving existing facilities[15]. Only six percent went for technology and eight percent for support services. Less than one percent went towards demolition and administrative costs[15].

Support

Detroit City Council

Detroit Proposal S received the full support of the Detroit City Council[16].

Robert Bobb

Robert Bobb, the Emergency Financial Manager of Detroit Public Schools has been the lead proponent and spokesperson of the plan on behalf of Michigan's largest public school district. Bobb was nominated by Michigan Governor Jennifer Granholm in 2009 to help the financially struggling district. Since Bobb was appointed, he inherited a $259 million dollar budget deficit and has closed 29 schools and overhauled other facilities to help tackle the budget problem[17].

Despite Bobb has led the efforts to get Proposal S on the ballot, he has faced sharp opposition from the Detroit Board of Education.

On October 29, 2009, Bobb made an announcement that he plans to continue as the Emergency Financial Manager of Detroit Public Schools for the 2010-2011 school year[18].

Detroit Federation of Teachers

The leader of the main teachers union of Detroit Public Schools, Mark O'Keefe supports Proposal S. O'Keefe who is the President of the Detroit Federation of Teachers supports the proposal, but has taken Robert Bobb the lead spokesperson of the bond referendum to task over hidden property tax increases[19].

During a public hearing on October 19, 2009, O'Keefe stated: “what has been said is the taxes aren’t going up, they’re staying at the same level longer.” O'Keefe further pointed out: “any way you cut it, the (stimulus) money is going to have to be paid back” citing the possibility of property tax increases. O'Keefe cited the possibility of property tax increases with having to come up with a local match as The American Recovery and Reinvestment Act of 2009 requires in most cases for government entities who accept these dollars to repay the government. Also, O'Keefe warned school board members and prospective voters that people remember the mismanagement that plagued the 1994 bond referendum was approved and felt that voters in 2009 were more skeptical on approving another high dollar bond referendum[19].

Opposition

BAMN

By All Means Necessary (BAMN), a racial advocacy group in Detroit has been the leading opposition group on Proposal S. BAMN opposes Proposal S over the reduction of the amount of school buildings in Detroit. Opponents of Proposition S think the terms "centers of excellence" and "schools of excellence" are deciphered for charter schools. BAMN thinks that Proposal S is costly for Detroit taxpayers to pay for new charter schools[20]. BAMN also thinks that the Detroit Public Schools are deceiving taxpayers thinking that the ballot question is to introduce a new millage, not extending a millage[20].

Detroit School Board

On October 8, 2009, the Detroit Board of Education did not fully support Detroit Proposal S. The decision by the whole Detroit School Board came after the Facilities Committee on the board voted 4-1 to not support Proposal S[16]. Detroit School Board members who serve on the Facilities Committee felt that the 1994 bond referendum that valued $1.5 billion and a subsequent state takeover that was poorly managed were the basis towards not approving the ballot measure. Also, many people felt that the future of the school district's leadership is unclear[16]. Robert Bobb who is overseeing Proposal S for Detroit Public Schools is up for re-appointment by Governor of Michigan Jennifer Granholm in March of 2010[16].

The Facilities Commission actions prompted seven Detroit School Board members to withhold their support over the lack of communication between Emergency Financial Manager Robert Bobb and the Board of Education[16]. In a separate presentation after the vote on Proposal S, Ricardo Kisner who serves as the District's Chief Financial Officer told the Board that the district is over-budget by $21 million dollars during the early part of the 2009-2010 budget cycle[21].

During a town hall meeting on October 20, 2009 held in conjunction with the Detroit School Board, Marie Thornton a member of the board warned that the ballot measure's approval by the voters is only temporary in nature. Thorton mentioned that under Michigan law, bonds approved under Proposal S must have the approval of the Michigan State Treasurer's Office to in order to move on any projects. Thorton warned prospective voters that the referendum may be squandered if Detroit does not get approval from the state citing that the Michigan Treasurer's Office has had rocky relations with the City of Detroit in the past[19].

Otis Mathis, an accountant and a Detroit School Board member thinks that Robert Bobb has mislead prospective voters on the claim that Proposal S does not raise taxes. Mathias cited that property owners are still paying taxes from the 1994 referendum by saying: “we’ll be paying for the $1.5 billion (referendum) until 2032." “They say there’s not going to be an increase in taxes, but they don’t tell you that 13 mills is the max you can tax yourself,” said the school board member. Mathias also cited that Detroit's rapidly shrinking property tax base could be a culprit for hidden property tax increases if S passes[19].

Despite supporters of Proposal S claim that Detroit citizens will have the first shot of getting jobs for related projects, opponents of S felt that there was no guarantee in writing that Detroit citizens would be given the first preference for jobs[19]. This was brought up as Detroit has one of the highest unemployment rates of any major city in the nation at 25 percent[19].

Detroit Free-Press

In a column titled on A reluctant "No" on Detroit Proposal S, the Detroit Free-Press editorial board expressed its disapproval of the multi-million dollar bond measure in its October 24, 2009 edition. The newspaper credited Robert Bobb for his leadership in selling the bond proposal to skeptical Detroit citizens, but warned voters that the uncertainty of who would lead Detroit Public Schools and the possibility of the project may be mismanaged led Michigan's largest newspaper to oppose the half billion dollar bond measure[22].

The Free-Press said that there is a need to improve facilities in Detroit's public school system, but warned Detroit citizens that property taxes would increase significantly if Proposal S was approved. Despite the bond referendum is considered to be an extension of a levy, the newspaper cited property values in Detroit that are falling. The newspaper warned citizens unless property values increase, the possibility of sharp property tax increases would be evident no matter how the ballot measure was sold to have no tax increases[22].

Detroit News

The Detroit News in its October 20, 2009 edition opposed Proposal S. The newspaper cited that without Michigan Governor Jennifer Granholm extending Bobb's contract for another year, that the same mismanagement that plagued the 1994 bond referendum will be evident again without sound oversight[23].

External links

References

  1. Free Press,"$500.5M bond for DPS set for vote," August 25, 2009
  2. 2.0 2.1 "Detroit Public Schools" Proposal S Description(See Slide 6)
  3. "Detroit Public Schools" Proposal S Description(See Slide 5)
  4. Associated Press, "State OKs Detroit schools' $500.5M bond vote," August 24, 2009
  5. "Detroit Public Schools" Detroit Proposal S Brochure(See center section, Page 1)
  6. "Detroit Public Schools" Adequate Yearly Progress Information(See Definition of AYP)
  7. "Stat Forecasting" Cohort Survival Formula Definition
  8. "Detroit Public Schools" District Data(See General School Information section)
  9. "Detroit Public Schools" Proposal S Description(See Slide 13)
  10. "Detroit Public Schools" Proposal S Description(See Slide 7)
  11. 11.0 11.1 11.2 "Detroit Public Schools" Proposal S Description(See Slide 8)
  12. [https://web.archive.org/web/2/http://www.detroit.k12.mi.us/admin/communications/docs/2009.09.21_Ballot_Language-11-4-09_Bond_Proposal.pdf "Detroit Public Schools" Official Proposition S Ballot Question]
  13. 13.0 13.1 "Detroit Public Schools" Proposal S Main Page(See 1994 Bond Section)
  14. 14.0 14.1 "Detroit Public Schools" 1994 Bond Construction Cost totals, October 10, 2009
  15. 15.0 15.1 "Detroit Public Schools" 1994 Bond Spending Distribution
  16. 16.0 16.1 16.2 16.3 16.4 "Detroit News" DPS board withholds support for school bond proposal, October 8, 2009
  17. "Detroit Free Press" Granholm wants DPS’s Bobb to stay for 2nd year, October 7, 2009
  18. "Lansing State Journal" Bobb to head Detroit schools for second year, October 29, 2009
  19. 19.0 19.1 19.2 19.3 19.4 19.5 "Michigan Messenger" Bobb, school board members grapple over Detroit’s Proposal S, October 20, 2009
  20. 20.0 20.1 "BAMN" Proposal S Information Page
  21. "Detroit Free Press" Detroit school board votes against backing $500M ballot measure, October 8, 2009
  22. 22.0 22.1 "Detroit Free-Press A reluctant 'No' on Detroit's Proposal S, October 24, 2009
  23. "Detroit News" Endorsements for Wayne School millages, October 20, 2009