MELISSA BLOCK, HOST:
A small public school district is about to go private. The emergency manager for schools in Muskegon Heights, in western Michigan, is turning the entire system over to a charter school operator.
And as Lindsey Smith of Michigan Radio reports, that's already a model for the state's other financially-troubled districts.
LINDSEY SMITH, BYLINE: The situation at Muskegon Heights Public Schools was dire. It ran $18,000 in the red each day school was open last year. After more than six years spending more money than it took in, the school board threw in the towel. They voted to give up their local authority to the state of Michigan.
This spring, the governor appointed an emergency manager who laid-off everyone on staff, including Leonard Vines. He was not surprised when he got a pink slip.
LEONARD VINES: It was a letter with everybody's name on it and you had to sign it. And it was saying official of this day, we was laid off because of the, oh, the crisis of what was happening.
SMITH: Vines was a special education aide for 15 years. He says everybody knew the end was coming. Falling property taxes and declining student enrollment are common for school districts in Michigan these days. But Muskegon Heights is also one of the poorest cities in the state. The average household makes just $20,000 a year. Test scores are dismal. Muskegon Heights High School is a staple on Michigan's persistently lowest achieving schools list.
Don Weatherspoon was the emergency manager brought in to try to fix the situation. He decided the only choice was to turn operations over to a charter company.
DON WEATHERSPOON: I am not against unions but this is the way I have to go, because I don't have any other options.
SMITH: Weatherspoon was appointed to avoid bankruptcy. And merging the district with another public school system nearby wasn't an option either. No other school district wanted to take on $4 million in debt and a $12 million spending deficit. This week, he announced Mosaica Education Incorporated will run the entire public school system for the next five years.
GENE EIDELMAN: The game is on and we're totally committed to have competitive sports and excellent bands, and also much better academics than what's been here before.
SMITH: About 60 people applauded Gene Eidelman, the president of the for-profit charter company. Eidelman says the biggest challenge for the fall is the district's empty coffers, so Mosaica will chip in its own money up front.
EIDELMAN: We have provided five and a half million dollar commitment to have the funds here so we can open until the first check arrives.
SMITH: So far, the details of the contract with Mosaica are still secret. Though the document was approved in an open meeting, it wasn't available to the public, and attorneys refused to share the information with reporters; basic information like how much money the district will pay Mosaica.
Weatherspoon brushed off concerns over disclosure. He says the information will be available in the next week or so, and no one in the audience seemed to mind either.
Angela Ogden is a former Muskegon Heights teacher and local union leader. She compares the whole situation to a prolonged death or a nasty divorce.
ANGELA OGDEN: Denial to anxiety and stress and sadness and, you know, you're up, you're down, you're everywhere. And so, to have something like this, it provides a sense of hope and excitement for everyone.
SMITH: The charter option could become a model in Michigan. An emergency manager of another struggling school district, Highland Park near Detroit, says he'll try to do the same thing, too.
For NPR News, I'm Lindsey Smith. Transcript provided by NPR, Copyright National Public Radio.