Affidavit in Support of Answer to Opposition of Emergency Motion

    UNITED STATES DISTRICT COURT 
EASTERN DISTRICT OF MICHIGAN 

SOUTHERN DIVISION

RONALD BRADLEY, e t a l,

P la in t i f f s , 

v

WILLIAM G. MILLIKEN, e t a l, C iv i l  Action

Defendants, No. 35257

and

DETROIT FEDERATION OF TEACHERS,
LOCAL 231 AMERICAN FEDERATION 
OF TEACHERS, AFL-CIO,

Defendant-Intervenor,

and

DENISE MAGDOWSKI, e t a l,

Defendants-Intervenors,
e t a l .
________________________________________________________________ /

AFFIDAVIT OF ROBERT N. McKERR IN SUPPORT OF 
ANSWER OF STATE DEFENDANTS AND IN OPPOSITION 
TO THE EMERGENCY MOTION OF THE BOARD OF 
EDUCATION OF THE SCHOOL DISTRICT OF DETROIT

FRANK J. KELLEY 
Attorney General

Eugene Krasicky 
Gerald F. Young 
George L. McCargar

 ̂ Assistant Attorneys General

Attorneys fo r Defendants 
Governor, Attorney General,

Business Address: State Treasurer, State Board o f
720 Law Building Education and Superintendent o f
525 West Ottawa S treet Public Instruction
Lansing, Michigan 48913



UNITED STATES DISTRICT COURT 
EASTERN DISTRICT OF MICHIGAN 

SOUTHERN DIVISION

RONALD BRADLEY, e t  a l,

P la in t i f f s , 

v

WILLIAM G. MILLIKEN, e t a l,

Defendants ,

and

DETROIT FEDERATION OF TEACHERS,
LOCAL 231, AMERICAN FEDERATION 
OF TEACHERS, AFL-CIO,

De fendant-Intervenor,

and

DENISE MAGDOWSKI, e t  a l,

Defendants-Intervenors,
e t a l .

/

AFFIDAVIT OF ROBERT N. McKERR IN SUPPORT OF 
ANSWER OF STATE DEFENDANTS AND IN OPPOSITION 
TO THE EMERGENCY MOTION OF THE BOARD OF 
EDUCATION OF THE SCHOOL DISTRICT OF DETROIT

STATE OF MICHIGAN)
COUNTY OF INGHAM ) SS

ROBERT N. McKERR, Being duly sworn, says that he 

makes th is a f f id a v it  in support o f the state defendants' answer 

in opposition to the emergency motion o f the Board o f Educa­

tion o f the school d is t r ic t  o f the C ity o f D etro it; that the 

facts set forth  herein are e ith e r  o f a f f ia n t 's  own knowledge 

or are matters o f public record, except those facts set forth 

on information and b e l ie f ,  as to which a ff ia n t  be lieves them 

to be true; that a ff ia n t  is  not d isqu a lified  from being a 

witness and i f  sworn as a witness cam te s t i fy  competently to

C iv i l  Action 

No. 35257



*• 4 %

the facts as fo llow s:

1. He is  the Associate Superintendent fo r Business 

and Finance in the Department o f Education for the State o f 

Michigan, and he has held the position  as such associate 

superintendent fo r a period o f s ix  years.

2. During the past year, formal meetings were held

as follows fo r  the purpose o f considering the finan cia l problems 

o f the D etro it public schools:

a. January 17, 1972, a meeting in Lansing,

Michigan, between representatives o f the State 

Board o f Education, Superintendent o f Public 

Instruction , the Municipal Finance Commission, 

the Governor, the Attorney General and Messrs.

Wolfe, McCutcheon and Brown, representatives o f 

the D etro it Board o f Education. The D etroit 

school d is t r ic t 's  d e f ic i t  budget fo r the year 

1971-72 was discussed and solutions therefor 

were considered.

b. February 10, 1972, a jo in t  meeting o f 

the D etro it Board o f Education and the State 

Board o f Education at D etro it. The D etro it school 

d is t r ic t 's  d e f ic i t  budget was considered.

c. March 9, 1972, a meeting at Lansing,

Michigan, between members o f the le g is la tu re , 

representatives o f the D etro it Board o f Education 

and representatives o f the State Board o f Education 

and the Superintendent o f Public Instruction. The 

matter considered was the d e f ic i t  budget o f the 

D etro it school d is t r ic t  and a cash c r is is  then 

ex is tin g .

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#

d. As the resu lt o f these meetings, the D etroit 

Board o f Education's immediate cash c r is is  fo r 

school f is c a l year 1971-72 was resolved, but the 

Superintendent o f Public Instruction continued

to  keep the leg is la tu re  advised o f D e tro it 's  

finan cia l problems, as appears from the le t t e r  o f 

the Superintendent o f Public Instruction to Dr. Charles 

Wolfe, March 23, 1972, and the le t t e r  o f the Superinten­

dent o f Public Instruction to Honorable G ilbert E. 

Bursley, A p ril 18, 1972, copies o f which are attached 

hereto and marked, respective ly , Exhibits B and C.

e. May 30, 1972, a meeting between the Superin­

tendent o f Public Instruction and Messrs. Wolfe

and McCutcheon, representatives o f the D etro it Board 

o f Education, to  consider a lternatives  in view o f 

the defeat o f a proposed tax rate increase at a May 

e lection  on two propositions to ra ise 10 m ills  fo r 

57.6 m illion  do lla rs  fo r  the school f is c a l year 

1972-73.

f .  June 1, 1972, a meeting between the Superin­

tendent o f Public Instruction and members o f the 

leg is la tu re  to advise them as to the continuing 

fin an c ia l problems o f the D etro it public schools.

g. June 2, 1972, a meeting between the Superin­

tendent o f Public Instruction , the Auditor General
\ ■

and members o f the leg is la tu re  to consider the 

D etro it Board o f Education's finan cia l problems. An 

audit by the Auditor General to ass is t the leg is la tu re  

was authorized and such audit was submitted to the 

chairmen o f the Senate and House Appropriations

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Committees on November 17, 1972.

h. July 18, 1972, a meeting between the Superintendent 

o f Public Instruction and Messrs. Wolfe and McCutcheon, 

representatives o f the D etroit Board o f Education,

fo r  further consideration o f finan cia l problems, 

particu la r ly  in view o f the D is tr ic t  Court's orders 

herein .

i .  August 15, 1972, a meeting between the Superin­

tendent o f Public Instruction and Messrs. Wolfe and 

McCutcheon, representatives o f the D etro it Board o f 

Education, fo r the consideration o f the same problems, 

p a rticu la rly  with regard to the e le c to rs ' defeating 

the m illage proposal at the August e lec tion  to raise

10 m ills  fo r 57.6 m illion  dollars fo r the school f is c a l 

year 1972-73.

j .  September 5, 1972, a jo in t meeting between the 

State Board o f Education, the Superintendent o f 

Public Instruction and the D etroit Board o f Education 

fo r  further consideration o f the finan cia l problems and 

solutions therefor.

k. September 30, 1972, a meeting between the 

Superintendent o f Public Instruction and members o f 

his s ta f f  and members o f the leg is la tu re  to update the 

leg is la tu re  as to the D etro it Board o f Education's 

fin an c ia l problems and to suggest various solutions 

thereto. One o f the resu lts o f th is meeting was the 

passage o f 1972 PA 276 on October 19, 1972, which

act authorized the D etro it Board o f Education to levy 

a tax rate increase i f  the same were approved by the 

e lectors  o f the D etro it school d is t r ic t  at the November

-4 —



7, 1972 general e lec tion . The school e lectors  o f

the D etroit schools re jected  a proposition fo r  5 mixls

or 28.8 m illion  do llars  fo r  the current school year.

l .  November 10, 1972, a meeting between the state 

defendants or th e ir  representatives, the president 

o f the D etro it Board o f Education and Messrs. Wolfe, 

McCutcheon and Brown. The state defendants or th e ir  

representatives agreed to recommend to the State 

Adm inistrative Board an advance o f state school aid 

funds and strongly recommended to the representatives 

o f the D etroit Board o f Education that the D etroit 

schools remain open.

m. November 14, 1972, the Governor and members 

o f his s ta f f  met with the state defendants or th e ir  

representatives to discuss a recommendation to the 

State Adm inistrative Board fo r an advance to the 

D etro it Board o f Education o f state school aid funds.

n. November 20, 1972, a jo in t  meeting between 

the D etroit Board o f Education, the Superintendent

o f Public Instruction and the State Board o f Education 

to review methods o f obtaining additional funding for 

the D etro it public schools. Among the proposals 

discussed were recommendations to the leg is la tu re  to 

authorize the D etro it Board o f Education to levy a 

non-property tax or to levy a property tax that would 

be excepted from the provisions o f Const 1963, art 9,

§ 6, the so-ca lled  15-m ill lim ita tion .

o. November 21, 1972, the State Administrative 

Board met and authorized the Superintendent o f Public 

Instruction to make an advance o f state school aid

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funds in the sum o f $22,000,000 to the D etroit 

Board o f Education, provided that the D etroit 

Board o f Education did not close i t s  schools during 

the months o f January and February, 1973. A copy 

o f the State Adm inistrative Board's resolution is  

attached hereto as Exhibit A. This is  consistent 

with the recommendations e a r l ie r  made by the Super­

intendent o f Public Instruction to the D etroit Board 

o f Education.

p. November 21, 1972, the state defendants, or 

th e ir  representatives, members o f the D etro it Board 

o f Education and members o f the le g is la tu re , including 

but not lim ited  to  the Speaker o f the House, the 

M ajority Leader o f the Senate, the chairmen o f . the 

House and Senate Appropriations Committees, the 

chairman o f the Senate Education Committee and members 

o f le g is la t iv e  education and taxation committees met 

fo r  the purpose o f updating the members o f the leg is la tu re  

on the current finan cia l situation  in the D etro it school 

d is t r ic t  and to consider means o f funding the D etroit 

public schools fo r the period from mid-March, 1973, to 

the end o f the school year in June, 1973, so that its  

pupils would receive 180 days o f instruction .

3. The fo llow ing table showing the revenues and 

expenditures o f  the D etroit public schools fo r the past f iv e  years 

and an estimate fo r  the current year shows that the school d is t r ic t 's  

present finan cia l problem has as i t s  cause the persisten t fa ilu re  

o f the D etro it Board o f Education to keep i t s  spending within its  

revenue:

- 6 -



(In M illions o f Dollars)

Year Revenue Expenditures
D e fic it  or 

(Surplus)
Cumulative

Total

1967-68 $207.9 $211.2
t

3.3 3.3

1968-69 225.3 224.4 (.9 ) 2.4

1969-70 236.3 2 37.0 .7 3.1

1970-71 266.1 279.0 12.9 16.0

1971-72 286.7 301.9 15.2 31.2

*1972-73 272.4 319.4 47.0 78.2

♦Estimated

4. In determining the wealth or resources o f a school 

d is t r ic t ,  the state equalized value per state aid membership 

ch ild  is  used because th is figu re shows the value o f the property 

as state equalized against which taxes may be lev ied  fo r  each 

ch ild  enrolled  in the schools o f the school d is t r ic t .  For the 

year 1972-73, the D etro it school d is t r ic t  has a state equalized 

value per ch ild  o f $20,561, which amount is  s lig h t ly  above the 

average state equalized value fo r a l l  school d is tr ic ts  in the 

state o f $20,277.
\

5. While the state equalized value per ch ild  o f a 

school d is t r ic t  is  a measure o f i t s  wealth or resources, the 

measure o f the tax e f fo r t  being made in the d is t r ic t  is  the rate 

o f tax lev ied  upon the taxable property within the school d is t r ic t .  

In the 1972-73 school year, the D etro it Board o f Education lev ied

a tax rate o f 15.51 m ills  fo r operating purposes upon the taxable 

property in the school d is t r ic t .  The statewide average tax levy 

fo r school operating purposes fo r  a l l  school d is tr ic ts  in the State 

o f Michigan is  somewhat in excess o f 24.0 m ills .

For the period o f f iv e  f is c a l years p rio r to 1972-73, 

defendant D etro it Board o f Education lev ied  taxes for school 

operating purposes as fo llow s:

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«• 4

Year Ratio M ills

1967- 68 20.76

1968- 69 20.76

1969- 70 20.76

1970- 71 20.76

1971- 72 20.80

6. In the D etroit public schools, instructional 

sa laries  (teachers) represent approximately 71 per cent o f current 

operating expenses. This is  the figu re fo r the 1970-71 school 

year, the la s t year that f in a l f ig u r e s  are ava ilab le to a ffia n t .

The salary schedule fo r  teachers in the D etro it school d is t r ic t  has 

been based prim arily upon the average o f the sa laries  paid teachers 

in the 7 highest paying school d is t r ic t  in the tri-county area

of Wayne, Oakland and MaComb. In the school f is c a l year 1971-72,

16 school d is tr ic ts  were used to compute the 7 highest minimum 

and 7 highest maximum salary ranges at each qu a lifica tion  le v e l 

paid by the D etro it school d is t r ic t  to it s  teachers. Of these 16 

school d is tr ic ts  only 3 lev ied  less than 24.0 m ills  fo r  school 

operating purposes in the school f is c a l year 1971-72.

7. In his a f f id a v it  in support o f the defendant D etroit 

Board o f Education's motion, Harold Brown says that the D etroit 

teachers received no salary increases whatsoever in the current 

year. A ffia n t is  informed and believes that, while there may not 

have been a general increase in the teachers' salary schedule in the 

D etro it schools, teachers did receive increased sa laries  by reason

o f th e ir  being awarded longevity increments or step increment increases.

8. Although a ff ia n t has not seen the master teachers 

contract or ind ividual teacher contracts o f the D etroit school 

d is t r ic t  fo r the current school year, he is  informed by Aubrey

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*

McCutcheon, an assistant superintendent o f the D etro it schools, 

and he v e r i ly  believes that such contracts provide fo r  termination 

by the defendant D etroit Board o f Education on or a fte r  A p ril 15, 

1973, upon the g iv ing  by i t  o f 60 days p rio r  notice. He is  also 

informed and be lieves that i t  is  customary fo r there to be a
. it

Christmas vacation in the D etro it public schools fo r the period 

commencing on or about the Friday before Christmas in each year,

and ending on or about the Monday a fte r  New Year's Day in each

year.,

9. One o f the reasons given by Harold Brown in his 

a f f id a v it  fo r loss o f revenue to the D etro it school d is t r ic t  is  

the use o f 0.64 m ills , approximately 3.7 m illion  do llars  per 

year, to support the D etro it C ity Public Library. This m illage

and amount was a llocated  to  the D etro it C ity Library by the
1

voluntary act o f the Defendant D etro it Board o f Education by 

resolution adopted May 23, 1972. I t  is ,  in e f fe c t ,  a grant or

g i f t  to the lib ra ry  by the defendant D etro it Board o f Education.

10. In his a f f id a v it  with regard to loss o f revenue, 

said Harold Brown said that a decision by the Governor to use 

his authority to withhold funds from school systems in order to 

balance the state budget has cost the D etro it school d is t r ic t  

approximately 6 m illion  do lla rs  in the past two years. In the 

f is c a l year 1970-71, pursuant to Const 1963, art 5, § 20, the 

Governor, with the approval o f the appropriating committees o f the 

House and Senate, reduced expenditures in the executive branch 

o f the state government to balance the state budget. With regard 

to school d is tr ic ts  the reduction a ffected  every school d is t r ic t  

in the State o f Michigan proportionally . The reduction reduced 

state school aid to the D etroit school d is t r ic t  in the amount o f 

$1,578,372. In the f is c a l year 1971-72, the Governor and the

- 9 -



*

appropriating committees o f the House and Senate did not pursue 

the mandate o f Const 1963, art 5, § 20, and no reduction was 

made. However, in section 1 o f the state school aid act, 1957 PA 

312, as amended, MCLA 388.611 e t seq; MSA 15.1919(51) e t  seq, 

as amended by 1971 PA 134, the leg is la tu re  provided fo r  the f:

budget d irec to r to reduce or adjust allotments in an amount equal 

to  .75 m ills  o f the state equalized valuation o f each school d is t r ic t  

or 20% o f the basic membership aid to the d is t r ic t ,  whichever is 

the lesser, fo r  the purpose o f creating a general contingency fund 

account, and the leg is la tu re  did not th erea fter authorize any 

payments thereunder. Had the state school aid act i t s e l f  not 

required th is reduction or adjustment, the D etroit school d is t r ic t  

would have received an additional $4,294,370. However, th is state 

o f facts is  purely hypothetical because in fact th is amount was 

never appropriated to the D etroit school d is t r ic t .

11. To a f f ia n t 's  knowledge, there is  no authority fo r 

the proposition stated in the a f f id a v it  o f Charles J. Wolfe that 

i t  is  educationally advantageous to close schools fo r an extended 

period o f time during the middle o f the school year rather than to 

close schools ea r ly . A ffia n t v e r i ly  be lieves that the educational 

advantage l ie s  in the continuous operation o f the schools fo r as 

long as possib le, p a rticu la r ly  under the facts o f th is case where 

there is  every reason to b e lieve  that the leg is la tu re  w i l l  respond 

to the D etroit public schools' fin an c ia l problems by providing some 

means to insure a fu l l  180 days o f instruction .

Subscribed and sworn to before me th is .._____________

day o f ; . , , 1972.
L  , '

Notary Public, Ingham CountyV 
Michigan
My Commission Expires: , . ,,

- 1 0 -



MEMBERS

WILLIAM G. MILLIKEN
(iOVf.RNOH
CtmirniMi

JAMES H. BRICKLEY
I ItUTENANT GOVERNOR 

RICHARD H. AUSTIN
SECRETARY OF STATE 

FRANK J. KELLEY
ATTORNEY GENERAL 

ALLISON GREEN
STATE TREASURER 

JOHN W. PORTER
SUPERINTENDENT OF 
PUBLIC INSTRUCTION

STATE OF MICHIGAN

WILLIAM G. MILLIKEN, Governor

STATE ADMINISTRATIVE BOARD
Lansing, Michigan 48913

November 22, 1972

The State Administrative Board, at its  meeting November 21, 1972, 
approved the follow ing motion. Those present and voting in favor 
of the motion: Governor W illiam  M illiken

Leon S. Cohan, Deputy Attorney General
A llison  Green, State Treasurer
Richard H. Austin, Secretary of State
John W. Porter, Superintendent of Public Instruction.

Mr. Green moved that the Superintendent of Public Instruction be 
authorized to advance $22,000,000 in 1972-73 state aid funds to 
the Detroit Schools. This amount is  to be released on or before 
December 31, 197X contingent upon the Detroit Public Schools 
operating school during the months of January and February 1973. 
The motion was supported by Mr. Austin and carried unanimously.

Recording Secretary

Exhibit A



JOHN W. I'OKT I K
Suporintcnucnt of 
Public Instruction

STATE OF MICHIGAN '  I ,

DEPARTMENT OF EDUCATION
Lansing, Michigan 48902

March 23, 1972

Dr. Charles Wolfe ' ’ ’■ ‘ •
General Superintendent 
Detroit Public Schools 
5057 Woodward •
Detroit, Michigan

/

STATE HOARD OP EDUCATION 
1 DWIN 1.. Nu V a K , O.D.

MU U A 1 I. J. D I KII 
Vhe President

DR. GORTON I’. l l  T IIM II 1.1'tt 
Srcret.iry

THOM AS I. IIRKNNAN 
Trtiisurcr

M A Itll YN Jl AN K M .L Y
a n n k t i a  m ii  i .k.r

DR C H A R M S  i ; MORION 
JA M I S I .  O N I.I I .

GOV. W i l l  1AM G. M II.M K .tN  
Ex-Olticlo

Dear Dr. Wolfe:

I am pleased to o f f ic ia l ly  inform you that according to information available  
to me, we have resolved two of the four major financial issues facing the 
Detroit Board of Education. i

f% !

First, we have taken appropriate steps to avert the April  cash cris is  by setting 
in motion arrangements for the Detroit School System to borrow $15 million 
against the June state aid payment.

Secondly, in cooperation with the Attorney General's Office and others, arrange­
ments have been consummated to eliminate the legal obstacles that prevented the 
Detroit Public SchooLs and ocher school districts from borrowing against next 
year's local tax levies. It is now possible for the Detroit Schools to make
application to the Municipal Finance Commission to borrow against next year's 
taxes.

Thus, the combination of the two actions will, enable the Detroit School System 
to complete the present fiscal year without any further reduction in school 
program. Therefore it is most gratifying that I am able to indicate that only 
two remaining Issues face us in working Detroit out of its present dilemma.

\
Botli of the two remaining issues are of greater magnitude than the above problems. 
1 refer speciflcal.lv to the State Board's concern regarding a school district  
adopting a deficit budget, which is contrary to state statutes. The other problem 
relates to those steps that will bo necessary to retire the $33 million deficit  
that the Del ruj l School SvsLen wi ll  face, as it initiates the 1972- 73 school year, 
even i f  the May 16 mil.lage is successful.

I am hopeful that with a successful millage, and with a tight budget for 1972-73, 
the above two remaining issues can be satisfactorily resolved. As in the past, 
we shal 1. assist the Detroit Schools in reaching, hopeiul lv, a successful solution 
to these very monumental problems.

Exhibit B



A.
V

i H i N  A  I ' O K I I K

<ip« t •■•' •»»

r,TAT(. O f MICHIGAN

DEPARTMENT OF EDUCATION
I r m s i n c j ,  Michignn 4f90?

April 18, 1972

Honorable G ilbert E. Burs ley 
The Senate 
Capitol Rutiding 
Lansing, Michigan

S T A t r  O f FO U C A TIO N
i • \ . '  . . . \ -N . M •

• . /*». . /, Mf
II- - 11 • ’ • "  I* - I I M I I I  I I'

S, . f. M*
1 |n • M \s I MM ‘s \  \\

■ ■ ■ i ' ■  '
'1 \ M I  V * 11 X‘ - K I I I S

\ •. \ | ‘ 1 Ml i  I I R 
| H- » * • I I N I Ml »U I«»N 

I \ M I s  I I » N l II 
. A  V. I| | I *M » .  M i l  I IK I 

/ * <*il„ !<•

Dear Senator Rursley:

I am writing to bring you up to date on the Detroit 
Public Schools' financial situation. As you w il l  reca ll from 
my March 6 letter and our March *> meeting, the Detroit D istrict 
had two basic problems. The f irs t  was a cash problem In the 
current f is c a l year which threatened to close school before 
the end of the school year, and the second related to a long 
range solution for the 1972-73 school year.

I am pleased to inform you that we have resolved the 
cash problem facing the Detroit Hoard of Education for the 
current school year. We have taken steps to allow Detroit to 
borrow $15,000,000 against the June state aid payment. In 
addition, the legal obstrtclea that prevented the Detroit 
Public Schools and other school d istricts from borrowing 
against next year's local tax levies have been eliminated.
The Detroit Schools have made application to the Municipal 
Finance Commission to borrow against next year's taxes.

We have received a tentative 1972-73 budget from the 
Detroit Tublic Schools which T am Including for your Informa­
tion. Very b r ie f ly , It  indicates that Detroit would end the 
1972-73 year with a defic it of approximately $18,000,000 which 
Is a reduction of $20,000,000 from the current year estimated 
d e fic it . I must emphasise, however, that the program is  at 
the current year leve l, and the revenues are based on success­
fu l passage of the 10 m ill proposal on May 16. It  Is my be lie f  
that nothing further can be done until a fter the May 16 millage 
election. Once the election Is held and the results are known, 
I w i l l  be in touch with you concerning future steps to resolve 
tha Detroit financial problem.

I must c a ll to your attention, however, that the Detroit 
School System even with a successful millage would need to receive 
a grant of $20,000,000 to maintain ita present level of operations, 
which means no Increase In sa laries .

\

i

f

Exh ibit C

■



Honorable G ilbert E. Buraley 
April 18, 1972 
Page 2

Because of that fact, i t  i i  important that d ia- 
cuaeiona begin soon on various alternatives to assist the 
Detroit Schools to recover from their financial problems.

Sincerely yours,

John W. Porter

CC: Charles J. Wolfe

Same letter  also sent: to Senators Robert VanderLnan, Coleman A. Young,
Charles t). dollar and Representatives William A. Ryan, Lucille. H. McCollough, 
Cli f fo rd  II. Smart and William U. Copeland.