An important revenue source that has helped the Detroit school district provide pay increases to employees will be up for renewal next year.
The Wayne County enhancement millage is one of three education millages that could appear on the 2020 ballot that would have a big impact on the district, charter schools and other public schools in Wayne County.
It’s a special millage that raises additional revenue for schools to use any way officials want, and is likely to appear on the ballot in November 2020. County voters first approved it in 2016.
If it isn’t renewed, the loss of revenue “would dramatically impact our budget,” Detroit Superintendent Nikolai Vitti said during a recent meeting.
Also potentially on the ballot in 2020: A proposed countywide millage that would raise taxes by two mills to pay for after-school and summer programs, and the renewal of an operating millage for the old Detroit Public Schools that goes toward paying off debt.
Here’s a run-down of what could appear on the ballot:
Enhancement Millage
This two-mill millage has generated nearly $80 million annually in additional revenue for Wayne County schools — money that has helped pay for things such as upgrading technology, improving buildings, and reducing class sizes. For many districts, it has helped to stabilize budgets.
In the Detroit district, $19 million is at stake. The revenue from the millage has helped provide pay increases for every employee group. That number will be reduced to about $15.3 million, though, because a new state law now requires the money to also be distributed to charter schools. Charters previously have not been allowed to share in enhancement millage revenue.
Randy Liepa is superintendent of the Wayne County Regional Educational Service Agency, which distributes the millage money to districts.
He said the money has been a game changer. Previously, he said many districts were focused on financial survival. Now they’re more focused on academic improvement.
“It’s changed the conversation and the lives for our local school districts here in Wayne County,” he said.
The millage doesn’t expire until the 2021-22 school year, but state law limits the agency from placing it on any ballot other than a presidential or gubernatorial ballot.
Before the renewal can make it to the November 2020 presidential ballot, it needs to get the approval of local school boards. Not every board has to OK it, but state law requires boards representing 51% of the student population in the county to approve the ballot initiative.
Liepa said a grass-roots campaign will help educate voters about the millage renewal. An important part of it, he said, will be for districts to explain how they’ve used the money.
“We think we have a success story to tell,” Liepa said.
In Detroit, the renewal will weigh heavily during contract negotiations next spring. The district is in the final year of three-year contracts with its unions. Vitti has used revenue from the millage to cover the cost of pay increases that extend beyond one year — what he describes as “re-occurring” costs. Separately, a rainy-day fund has covered the cost of bonuses.
“We have to begin to speak with one voice and provide clarity that there can be no re-occurring increases beyond this year due to the fact that this enhancement millage will have to be renewed,” Vitti said.
Still, he’s confident voters won’t reject it.
“All signs point to this being renewed,” Vitti said.
Detroit Public Schools operating millage
Another likely ballot initiative is the renewal of an operating millage for Detroit Public Schools, which exists primarily to pay off debt. In 2016, a legislative initiative created a new entity — the now three-year-old Detroit Public Schools Community District — that exists solely to educate students.
The split was part of a sweeping plan to resolve the massive debt that had crippled DPS and its schools. While the millage revenue goes toward paying off debt, the newer district is funded through the state school aid fund, which provides per-pupil funding for schools in Michigan.
The operating millage revenue is important to projections that the old debt in DPS will be paid off in 2027.
“The complication for us is that these dollars are not funding our day-to-day operations.” Vitti said during that Sept. 27 committee meeting. “And for Detroit residents, that’s obviously a complicated structure and situation.”
The 18-mill operating millage generates $70 million annually in revenue and affects non-homestead property, which includes industrial, commercial and rental property. Homeowners are not affected by the millage.
The millage expires Dec. 31, 2022. August 2020 is the first opportunity the district will have to place a renewal before voters. They would have several more opportunities to put the question before voters before the millage expires. If voters reject it, bond holders could seek a judgement against all residents of the city, which would then affect homeowners.
After school/summer school millage
Plans are afoot to place, possibly as soon as March 2020, a request on the countywide ballot asking voters to approve increasing taxes by one mill to generate revenue for after-school and summer programs for Wayne County children.
Crain’s Detroit first reported on this initiative in May, saying the Skillman Foundation and the city of Detroit are major players in the plans. A spokesman for the city declined to comment.
Natalie Fotias, spokeswoman for the foundation (which also funds Chalkbeat), said Skillman’s role has been to fund the exploration of different ideas for providing dedicated funding for after-school programs.
“This is one of them,” Fotias said.
That exploration came in part because the foundation is “a long-time supporter of after-school programs,” but also because it has heard over and over from advocates who want to know what more can be done to ensure all students have access to such programming, Fotias said. Another role the foundation has taken on, she said, is urging community leaders to prioritize after-school programs and the funding for them.
Editor’s note: This story has been updated to clarify the amount of mills that would be requested as part of a millage proposal for after-school and summer school programs.