Although it has received scant media attention, a lawsuit filed in late June by members of Detroit’s school board, activists and parents could undo the controversial education system Gov. Rick Snyder and the Michigan Legislature have created for the city.
Of course, “could” is the operative word here. The power and resources of the state are lined up against a group that has been shoved into the margins, operating with no money and a limited platform. But according to at least one expert, the basis of the suit, which was filed in the Michigan Court of Claims, appears to rest on a sound legal foundation.
There is much at stake, including the possibility of stopping the state from pursuing a plan that one financial consultant warned could stick taxpayers with the bill for “hundreds, or possibly thousands, of hours of additional work” that could be avoided by taking a different approach.
The suit seeks to address two serious legal questions raised by the state’s plans:
• Can the state—which just passed a new provision allowing it to hire untrained and uncertified teachers into Detroit schools and Detroit schools only—subject the city’s primarily African-American students to its new school system in a manner that is separate and unequal?
• Does the creation of this new Detroit-specific district amount to a “local act”—and thus, as required by the state Constitution, demand approval by a two-thirds majority of both houses of the Legislature and a majority of Detroit voters?
Speaking about the first issue, Steven Rhodes, the retired federal judge who presided over Detroit’s bankruptcy proceedings and is now the so-called “transition manager” (in essence an emergency manager, appointed by Gov. Snyder) running the district, expressed concern.
"It does raise constitutional equal protection questions," said Rhodes of the controversial, Detroit-exclusive measure during one of the final meetings of the board before it is disbanded. "I find it problematic. It is hard to fathom justification for that. A rational reason is not apparent to me."
But even if that provision were to be ruled unconstitutional, it could conceivably be removed while the rest of the law – package of laws, actually – remains in place and creates an entirely new structure.
As it stands now, that structure – referred to works like this: The entity known as Detroit Public Schools, now referred to as the “old district” or “OldCo,”continues to exist, but only as a vehicle to pay off accumulated debt.
Furthermore, the duly elected board – which has been without power since appointed emergency managers began running the district – will cease to exist completely after a new, seven-member board elected in November and seated in January takes over limited control of the new district, dubbed the “NewCo.” An appointed financial review commission – the same body that currently has final say over the City of Detroit’s budget – will also oversee both the old and new school districts.
Citing concerns over equal protection under the law, the lawsuit filed last week challenges the legality of placing Detroit schoolchildren in a district that is so radically different from any other public-school district in Michigan.
Meanwhile, the lawsuit filed in the state Court of Claims also drives at the second major issue raised by the state’s plans—the matter of the creation of the new district equaling a “local act.”
Under the Michigan Constitution, laws considered to be “local acts” – meaning legislation that targets a specific city, county or school district – must receive approval to a two-thirds majority in both houses of the Legislature and must also be approved by a majority of the voters in the targeted jurisdiction.
There is an escape hatch, of sorts, that allows the legislature to get around the massive “local acts” hurdle: Essentially, if the law is written in such a way that, if it is even theoretically possible it could apply elsewhere, then it can be considered a “general” rather than a “local” act.
This helps explain why a number of laws targeting both the City of Detroit and Detroit Public Schools refer to a city with a certain population or a school district with a certain number of students. Even if it is not even remotely possible that another city in the state would reach 750,000 people, say, the legislature could design laws specifically aimed at Detroit simply by saying the new law affects any city with a population exceeding 750,000 residents… without that law being considered a local act.
According to the lawsuit, here’s the flaw in the new school-district legislation: As written, the law makes it impossible for any other district to meet the criteria for what’s referred to as a qualifying district.
Here’s where the weeds get even deeper.
The just-enacted legislation is targeted at what it calls “qualifying” districts, meaning any district that “was previously organized and operated as a first class district” before the law would take effect.
“There is no possibility whatsoever that any other school district in the state could meet this definition given the transition date of July 1, 2016, because no other school district in the state ‘was’ a first-class district at that time, and no other school district has ever been a first class school district in the history of state education,” according to the lawsuit.
It’s a parsing of language that is downright Clintonian.
“The specific use of the language ‘was previously organized and operated’ can only mean events that have already occurred in the past,” the lawsuit claims. “’Was’ is the past tense of ‘is’ and must be attributed its plain and unambiguous meaning.”
Could the difference between “was” and “is” really be that critical?
The answer is yes, according to Justin Long, an assistant professor at Wayne State University School of Law who specializes in the Michigan Constitution and state law.
“I do actually think they have a pretty strong case,” said Long.
He pointed to a 2002 decision by the Michigan Supreme Court, in the case State vs. Wayne County Clerk that clearly established that, if the law can’t be applied to any other unit of government, then it is a “local” act and must be treated as such.
In short, because of the criteria used to identify DPS as a “qualifying” district under the legislation, it is now “theoretically impossible” for any other district to meet that same criteria, explained Long.
It is possible to construe this lawsuit as a sort of Hail Mary pass, a desperate, last-ditch effort on the part of the elected school board and its supports to keep the old district intact. And the battle they are fighting is decidedly uphill. They have no money.
The lawyer representing them, Thomas Bleakley, is working for free in an area of the law that’s outside his expertise.
It is also possible, however, to view the action as an attempt to put the brakes on legislation that has drawn broad criticism – some of it from rather surprising quarters.
In fact, some of the most damning criticism of the state’s efforts to reorganize DPs comes from an advisor to Judge Rhodes, the man appointed by Gov. Snyder to oversee the transition.
We know that because of a scoop from investigative reporter Jim Kiertzner at television station WXYZ-TV.
Last week, Kiertzner produced a startling story based on documents activist Robert Davis obtained through the Freedom of Information Act.
To be sure, Davis is an imperfect source. He was in prison not long ago, serving time for embezzling $200,000 while on the Highland Park school board. Regardless of Davis’ flaws, though, the documents he obtained speak for themselves. And what they have to say is startling.
The documents Davis obtained include March 2016 emails to Rhodes from Al Koch, managing director of AlixPartners. The firm, which specializes in corporate restructuring, played a pivotal role in GM’s bankruptcy proceedings.
That experience with GM, helped inform the advice Koch gave to Rhodes in March.
“The finance team believes that we should explore the potential to avoid setting up a new School District,” wrote Koch, whose services were being provided pro bono, in correspondence to Rhodes in March. “If it can be accomplished it will generate major financial savings, avoid hundreds or possibly thousands of hours of additional work and avoid confusion among parents, teachers and other stakeholders without sacrificing ANY of the benefit from the state’s financial assistance.”
The alternative plan, establishing a trust rather than pursuing the so-called “OldCo/NewCo” model established by Snyder and the legislature, would “eliminate an enormous amount of work, avoid major coast, and so without sacrificing any of the OldCo/NewCo benefit envisioned by the State’s proposed plan.”
A subsequent memo detailed the financial disarray that existed at DPS under emergency management, including substantial questions about what the district’s deficit really is.
“What all of this means to me is that the opportunities to balance revenues and expenses with the Governor’s restructuring plan as it is currently proposed will be extremely difficult,” Koch warned. “It raises the point that beginning in year 1 the [new] district will be spending more than it is taking in and will need to resort to incurring new debt in order to operate.”
In June, after the final version of the state’s plan had been enacted, Rhodes told the school board that the $150 million being borrowed to pay for transition costs fell far short of what was needed. Optimally, Rhodes told the board, as much as $300 million should have been allocated to cover the costs of transitioning to the OldCo/NewCo system.
Kiertzner asked the governor’s office about all this. He received the following statement in response:
“The Governor’s Office was aware of differing opinions on how to remedy the financial and academic failures in Detroit Public Schools. It was determined that the method the state went with – splitting DPS in two – was the best option for the district, the families of Detroit that it serves, and the state as a whole.”
Curt Guyette can be reached at 313-578-6834 or cguyette@aclumich.org.
"It does raise constitutional equal protection questions," said Rhodes of the controversial, Detroit-exclusive measure. "I find it problematic. It is hard to fathom justification for that. A rational reason is not apparent to me."
