Moody’s Investors has been on a ratings downgrade rampage for Michigan’s school districts. Here is its explanation from the new sector comment report:
A majority of Michigan school districts have realized declines in enrollment over the past decade. Of the 549 public school districts in the state, 425 lost students from 2004 through 2012, with total statewide school enrollment (excluding charter schools) falling by 13.2 percent.
Demographic shifts like the one occurring in Detroit are devastating to municipal budgets. Typically fewer taxpayers have to carry a greater share of the costs of a municipal infrastructure, which rarely shrinks in proportion with population loss. But Michigan has another substantial problem: Its charter schools. From Moody’s again:
Beyond these statewide population trends, the increasing presence of charter schools in Michigan is also hurting traditional public school enrollment. Both the share of students enrolled in charter schools and the number of charter schools operating in Michigan have grown steadily in recent years.
How many charter school students are in Michigan?
Enrollment in charter schools increased more than 60 percent from 2004 through 2012 as the number of charter schools grew from 199 to 256. This brisk pace of expansion does not appear to be easing, with charter schools increasing in number by another 8 percent to 277 in the 2012-13 school year and again by 8 percent to 298 in the current 2013-14 school year.