2016 Senate Bill 822 / Public Act 197

Give bailout to Detroit school district

Introduced in the Senate

Feb. 24, 2016

Introduced by Sen. Goeff Hansen (R-34)

To essentially eliminate current caps on the amount the state can lend for “financial emergency” loans to public school districts that spend more than they take in. This is to accommodate Gov. Rick Snyder’s proposal to bail out the insolvent Detroit school district by dividing it into two entities, one to run the schools and the other to service the district’s debt (see Senate Bill 710 and House Bill 5384).

Referred to the Committee on Government Operations

March 22, 2016

Passed in the Senate 21 to 16 (details)

To authorize an immediate $300 million loan to the Detroit school district to cover debt incurred through over-spending in successive budgets. Also, to greatly increase the current caps on the amount the state can lend for “financial emergency” loans to municipalities and public school districts that incur overspending deficits. The bill is considered a "down payment" on an expected $515 million bailout and another $202 million for "transition costs." See also Senate Bill 710.

Received in the House

March 23, 2016

Referred to the Committee on Appropriations

May 3, 2016

Reported without amendment

With the recommendation that the substitute (H-2) be adopted and that the bill then pass.

May 5, 2016

Amendment offered by Rep. Brian Banks (D-1)

To authorize lending the Detroit school district $33 million to cover salaries in the event an expected bailout package does not go into effect before the district runs out of money.

The amendment failed by voice vote

Passed in the House 55 to 53 (details)

To authorize an immediate $33 million loan to the Detroit school district to cover debt incurred through over-spending in successive budgets. Also, to greatly increase the current caps on the amount the state can lend for “financial emergency” loans to municipalities and public school districts that incur overspending deficits. The bill is considered a "down payment" on an expected $500 million bailout of the district.

June 2, 2016

Received

Motion to reconsider by Rep. Aric Nesbitt (R-66)

To reconsider the vote by which the House passed the bill.

The motion passed by voice vote

Substitute offered by Rep. Al Pscholka (R-79)

To adopt a version that delivers $150 million for Detroit school "transition costs," as agreed to by the House.

The substitute passed by voice vote

Passed in the House 56 to 52 (details)

To give the Detroit school district $150 million for "transition costs" as it executes the new governance structure authorized by House Bill 5384, of which no more than $25 million can be spent on deferred maintenance.

Received in the Senate

June 8, 2016

Amendment offered by Sen. David Knezek (D-5)

To lend the Detroit school district another $300 million on top of the other money in the bailout package.

The amendment failed 14 to 23 (details)

Passed in the Senate 21 to 16 (details)

To give the Detroit school district $150 million for "transition costs" as it executes the new governance structure authorized by House Bill 5384, of which no more than $25 million can be spent on deferred maintenance.

Signed by Gov. Rick Snyder

June 21, 2016