Detroit school board votes to reject state-proposed loans
Members of the Detroit Board of Education have voted to reject a set of state-proposed loans to help bail-out the struggling district.
Last week, Governor Snyder signed off on a $617 million package to create a new, debt-free Detroit school system. The two rejected loans are part of the state's bail-out plan and total $385 million.
Board president LaMar Lemmons says the interest rates on the loans are too high.
"[The board] intends to go to the Securities and Exchange Commission because of the level of abuse in terms of borrowing by irresponsible financiers, who have borrowed at risk rates when they should've been borrowing at much lower rates," Lemmons said.
On Monday Snyder said he hadn't yet looked at the details of the board's concerns but intended to move ahead with the state's plan.
"The board] has opportunities to use the court system like anyone else, but I'm moving forward with implementing the legislation," Snyder said.
Lemmons says board members also took issue with the state's plan to divide the district into two entities -- one to pay off debt and one to educate kids.
He says the board plans to present alternatives to the state's plan later this week.