MUSKEGON HEIGHTS, Mich. (WZZM) - The recently-appointed state financial review team heard differing views on the need of an emergency financial manager for the Muskegon Heights Public Schools -- the interim superintendent said the EFM was "crucial," while the head of the district's teachers union said the administration needs time to fix its problems internally.

The review team held an all day public hearing Wednesday at the Muskegon Heights school administration building.

The purpose of the public meeting was to question school leaders about the district's $12 million debt. The review team learned one-quarter of the debt is owed to local vendors like the city of Muskegon Heights. The district's water bill also remains unpaid, as it is almost $40,000 dollars and growing.

Muskegon Area Intermediate School District superintendent Dave Sipka is the interim superintendent of the Muskegon Heights district. He told the team the district's finances are so bad teachers this month will again be paid four days late. The payday delay is expected to reach one week in April.

Sipka says if the state garnishes the district's state aid payment teachers might not be paid at all. He told the team he believes the district is in need of an emergency financial manager.

"My recommendation would be that an emergency manager be in place as soon as possible," Sipka said.

Michigan Education Association leaders were also given time to address the team. Two representatives from the union that represents the districts 55 general education teachers asked the team to be patient and allow the debt crisis to be fixed internally.

"You can not just look at finances in a vacuum in order to save this district," says Krista Abbott with the MEA.

Abbott is concerned a state emergency financial manager will focus too much on numbers without concern for students. Abbott says the MEA and teachers are willing to offer wage and health care concessions immediately. According to Abbott, the union's plan could save the district $500,000 this school year and $2 million the next two years.

While the review team is considering its recommendations, the Muskegon Area Intermediate School District is preparing for a number of scenarios -- ranging from finishing out the current school year to bankruptcy to dissolution of the district.

An emergency manager could use broad powers to void or make changes to the teachers current contract. The team has three weeks left to report its findings and make a recommendation to Governor Snyder.

Reported by Jon Mills in Muskegon Heights