Highland Park Public Schools will become the second district in the state of Michigan to fall under the control of an emergency manager.
Michigan Gov. Rick Snyder announced in a release Friday afternoon that he considered the district to be in a state of financial emergency and that Jack Martin, a former chief financial officer of the U.S. Department of Education, would be named emergency manager.
Under Michigan's Public Act 4, the governor can appoint managers with nearly unlimited authority to run cities and school districts that fail a financial stress review.
Snyder ordered the state takeover the Highland Park School District after the district's financial review board unanimously recommended an emergency manager.
The review board based their decision on the following findings:
- The HPS cumulative deficit increased by 51 percent over the past fiscal year, growing from $6.6 million to $11.3 million, according to the district’s fiscal year 2011 financial audit. Expenditures exceeded revenues by $3.8 million in FY 11.
- The district’s pupil enrollment has decreased by 58 percent since 2006, dropping from 3,179
pupils to 1,331 for FY 2011. Current estimates show a pupil count of 969.
- The district has incurred an operating deficit in five of the last six fiscal years.
- As of Nov. 15, 2011, HPS owed more than $1.7 million in accounts payable, which range from 30 days to 6 months old.
The report also noted the district had not been helpful with the investigation, missing deadlines and providing conflicting information.
Highland Park School Board member Robert Davis told the Detroit News he plans to challenge the board's recommendation in court.
"The process was very flawed and illegal. I am contemplating legal action," he said.
Davis has already filed a lawsuit against Detroit Public Schools Emergency Manager Roy Roberts.
DPS was the first district, and first municipal body, to receive an emergency manager under Public Act 4. The district previously had an emergency financial manager appointed by former Gov. Jennifer Granholm. Highland Park Schools is the fifth municipal body in Michigan to fall under the control of an emergency manager.
While CFO at the U.S. Department of Education under President George W. Bush, Martin promoted and implemented the now contentious No Child Left Behind Act, which requires schools to meet performance benchmarks based on standardized test scores.
Snyder said in a release he believes Martin has the qualifications necessary to help turn the struggling Highland Park district around.
“Given his understanding of the critical importance of education and his background as a C.P.A., I'm confident Mr. Martin is well-suited for this post, and will work quickly and efficiently to address the financial emergency faced by Highland Park schools," he said.
Martin is a Ferndale native and the founder and chairman of the accounting firm Martin, Arrington, Desai & Meyers.
He also belongs to the state-appointed review board currently investigating the City of Detroit's finances. That investigation could result in the appointment of an emergency manager for the city.
Martin will begin his duties in Highland Park on Monday.