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State fronts Muskegon Heights schools cash so district can pay teachers, staff

Lindsey Smith
Michigan Radio

Updated 4/2/14:

An attorney for the MHPSA board says all employees have been paid as of today. He said there was a "glitch" in payroll but declined further comment on this story at this time.

Original post 4/1/14:

The state is fronting $231,000 to the charter school district in Muskegon Heights so it can pay its employees. Teachers and staff didn’t get paid like they were supposed to on Monday.

The new Muskegon Heights Public School Academy System was set up in June 2012 when the old school district there went broke.

A state-appointed emergency manager created the PSA, which hired Mosaica, a charter school company, to run the school system. Now the new school system is running a deficit of its own.

An independent audit published last fall reports the district ended the fiscal year in June 2013 with a deficit of a little more than half a million dollars.

The charter school system couldn’t make payroll this week, even though it just got $455,000 from the state March 20. It informed the state on March 28.

The money the state treasury is sending the district will come out of the charter district’s April state aid payment. That’s enough to pay teachers and staff for two weeks, according to Michigan Department of Treasury Spokesman Terry Stanton.

Still, Stanton says the district shouldn’t have a problem making payroll next month.

“At this point, that’s not our expectation but we’re still looking into the issue and trying to get to the bottom of what has happened here,” Stanton said. He says that may take a few days.

School administrators, board members, attorneys, and the emergency manager did not return requests for comment. Michigan’s Department of Education referred all questions to Stanton.

Stanton says there was a private meeting in Lansing Tuesday with emergency manager Gregory Weatherspoon, some of his staff, and officials with Mosaica to discuss the situation and next steps.

“Things are where they are right now and we’re continuing to look into the issue,” Stanton said.

Lindsey Smith helps lead the station's Enterprise Team. She previously served as Michigan Radio’s Morning News Editor, Investigative Reporter and West Michigan Reporter.
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