A Southwest Michigan community is rallying around its high school in hopes of keeping the doors open amidst serious financial strain.

The Benton Harbor City Commission approved a “fresh start resolution” last week that would help to forgive the district’s debt in hopes of preventing the closure of Benton Harbor High School. This move comes after the Benton Harbor School Board rejected the state’s proposal to close the high school.

As Michigan Radio reports the state has cited the district’s $18.4 million debt as the reason behind the recommendation to close the school.

What we are seeing play out in a community that’s struggling economically is not unique to Benton Harbor.

As CMF has reported, the Michigan School Finance Study found that “overall, Michigan’s school finance system is moderately inequitable." The research pointed out that districts with higher need tend to have fewer resources available to serve students. 

Earlier this month, Michigan’s Department of Treasury provided its quarterly report to the Legislature on the fiscal health of Michigan school districts. This is the 15^th report of its kind that the department has provided to the Legislature highlighting potential fiscal stress within a district since such reporting became required by state law in 2015.

To identify these schools, the department uses a projection model that includes enrollment, revenue, expenditure and fund balance of a district for two fiscal years. It also examines budget information from all 900 districts to track changes.

The first report that was issued in 2016 showed 19 districts experiencing potential financial stress. Of those, 15 have improved their finances, two incurred deficits and two remain in potential financial stress.

The latest report shows many districts are struggling around the state, including both urban and rural districts.

2019 data at a glance

• 15 districts are experiencing potential financial stress.

• The districts include the school district of the city of Flint, Ionia Township, Eau Claire Public Schools, Beaverton Rural Schools, Forest Park School District and more. You can view the full list on page 5 of the report.

• Of the 15, one district, Chassell Township has already improved their finances and has been removed from the list.

As efforts continue to prevent the closure of Benton Harbor High School, it’s clear that struggling district finances is an issue facing communities around the state.

In Michigan, education remains the top investment area for funders with nearly a quarter of the roughly $1.6 billion in annual philanthropic giving going to education.

CMF and the Office of Foundation Liaison are engaging with members who would like to begin collaborative, informative conversations about what’s happening in these communities statewide. If you are interested in being involved in these conversations and helping to shape potential strategies for our philanthropic community, please connect with OFL. 

Want more?

Read the full report.