Retired U.S. Bankruptcy Judge Steven W. Rhodes, now the Detroit Public Schools’ ‘Transition Manager’, just let another financial whopper out of the bag. Detroit Public Schools received about $30 million in U.S. Department of Education reimbursements for the pensions of grant-funded employees, but failed to forward those federal funds to the Michigan Public School Employees Retirement System. So DPS owes MPSERS $ 30 million dollars, give or take. They are ‘negotiating’.
DPS officials knew of this funds misappropriation in December 2015. Judge Rhodes knew “in March 2016”. Before or after the Michigan Legislature got suckered into passing HB 5296 and HB 5385, the DPS emergency bailout and purported financial review commission? HB 5296, the $ 48.7 million emergency DPS bailout, cleared the Michigan House on 17 March and the Michigan Senate on 24 March. Governor Snyder signed it as Public Act 54 on 12 April.
Did anyone in Lansing know that 60% of the PA 54 DPS bailout was headed straight to the MPSERS?
If so, why did they not share this little detail with the rest of the Legislature and the public prior to the passage of HB 5296?