“The scope of reductions under consideration by the Grand Rapids Public School Board should be a wake-up call for the entire community. We can no longer expect business as usual—what was once unimaginable now becomes reality.” - Grand Rapids Education Reform Initiative.

While it is a national trend that public schools are struggling financially, each state has a unique situation due to different funding practices. The budget problems are often blamed on poor money management: too many administrators, too high levels of salaries, extra cost in working with unions, excessive benefits. As for Grand Rapids Public Schools, there are four reasons for the financial crisis: State funding, declining enrollment, high needs student population, and increasing costs of employee benefits which are mandated by the State.

This paper analyzes the funding issues of the Grand Rapids Public Schools by looking at the history of how school funding has changed with the creation of Proposal A—how revenues are collected and distributed, and how Proposal A has been modified since inception. In analyzing the issues surrounding what seems to be an unfixable budget problem, two questions arise: Is state funding meeting the needs of the students in Michigan? And, is there need for a policy change?