Bankruptcy next for DPS?

DETROIT - Potential bankruptcy, continuing budget problems, more staff cuts and allegations of theft at Detroit Public Schools all were reported by Detroit media during the past week.

Meanwhile, the district's teachers union announced an investigation into potential embezzlement in its own operations.

Robert Bobb, DPS emergency financial manager, announced Monday that the district's budget calls for spending $259 million more than it has in revenue, that he will cut about 2,500 employees rather than the 1,800 announced earlier, and that he is considering filing bankruptcy, the Detroit Free Press reported.

To avoid continued overspending next year, labor unions would have to agree to larger class sizes and $137 million in concessions, potentially including unpaid furloughs and health care benefit cuts, the Free Press reported.

In other news, six DPS employees were suspended and face possible legal charges for allegedly stealing money or computers or for alleged abuse of students, according to the Free Press.

Finally, The Detroit News reported that Detroit Federation of Teachers President Keith Johnson announced a forensic audit of union finances in a case involving alleged embezzlement of tens of thousands of dollars. He told The News that he and another employee noticed financial irregularities about two months ago.

Last year The News reported that the union was behind by $1.5 million on dues owed to its state and national affiliates, among other financial difficulties.

SOURCES:
Detroit Free Press, "6 DPS employees suspended," June 27, 2009

Detroit Free Press, "Bankruptcy may be next for Detroit schools, Bobb says," June 29, 2009

The Detroit News, "Detroit teachers union investigates embezzlement," June 26, 2009

FURTHER READING:
Michigan Education Report, "Should Michigan lift the cap on charter public schools? Yes" Nov. 21, 2006