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Deficit District Information
A district is considered to have a deficit fund balance if it has adopted a deficit budget or incurred an operating deficit as evidenced by the following:
1) Its total General Fund balance is negative, or projected to be negative at the end of the current fiscal year; or,
2) Other funds have negative fund balances or projected negative fund balances that are greater than the General Fund balance.
Requirements and Deficit Elimination Plan Template
Section 1220 of the Revised School Code (MCL 380.1220) requires deficit districts to submit a Deficit Elimination Plan (DEP) to the Department. Districts are responsible for developing a plan to eliminate the deficit. These plans are approved by the local board of education and then submitted to the Department for approval.
Section 1220 of the Revised School Code (MCL 380.1220) requires the Department to submit quarterly reports on deficit districts to the standing committees of the legislature responsible for K-12 education legislation.