"The Detroit schools are in need of a transformational change," he told lawmakers. "... Not all Detroit students are gaining the education they deserve."
The Republican governor says he wants the current $1,100 per student being spent to service debt to be shifted to give classroom teachers the resources they need.
Detroit Public Schools teachers say negative working conditions -- including overcrowding and insufficient maintenance -- that were brought about by starved city and state budgets are hurting students' education.
Many teachers have conducted protest sick-outs and more are expected Wednesday. A union official said 30 schools may be affected.
The beleaguered school system has said it will need significant dollars from the Legislature to address its massive debts.
A proposal introduced last week in the Legislature would create a second school district within the city that assumes control over all of its schools and students, while leaving the current Detroit Public School system with only the district's debt, according to author state Sen. Goeff Hansen.
The Detroit system is burdened with an estimated $515 million of debt and is facing insolvency as early as April, according to the school district's emergency manager, Darnell Earley.
"It's a high priority. It's an emergency situation," Hansen said.
About $7,400 is allocated per student each year. But close to $1,200 of that per student amount is going to pay down debt and legacy costs in the city school system rather than heading to the classroom, according to Hansen.
Under the proposal, the debt isolated in the Detroit Public Schools system would continue to be paid off by revenue from city taxpayers but would give the state room to inject the additional funding into the new school system.
The return of sick-outs
Last week, thousands of students stayed home over three days as teachers staged a sick-out, an off-the-books strike by teachers who called in sick to their schools in protest over conditions, according to Steve Conn, the labor leader who organized the protest.
Conn said he expects another sick-out on Wednesday, the same day President Barack Obama is in town for a major international auto show.
Detroit Public Schools, in a Facebook post Tuesday night, said five schools will be closed Wednesday because of "high teacher absences." It said more closings may occur, while noting all staff members are expected to report to work.
Ivy Bailey, interim president of the Detroit Federation of Teachers, said the latest sick-out is the result "of the lack of respect that has been displayed toward teachers in this district, hazardous working conditions, oversize classes" and other factors. "Teachers are fed up and have had enough. Our students deserve better," Bailey wrote in an email to CNN.
"It looks like there will be over 30 schools out, if not more," said Bailey.
Earlier, in a more optimistic note, the teachers federation said that a "first breakthrough" was the district agreeing to demands on staff meetings, sick leave accrual and a labor-management committee on curriculum.
"In addition to working for better physical conditions and adequate resources in schools and classrooms, we also know we must address the very real concerns teachers have," including stagnant salaries and frozen pay steps, the union said on its website.
Two crises in Michigan
Michigan is grappling with two crises
-- Detroit Public Schools and the situation in Flint, where a water source switch resulted in high lead levels and corrosion.
Earley, the Detroit schools emergency manager, was emergency manager in Flint when the city switched its source in 2014. Earley has said he was not responsible for the decision -- only with implementing it after it was approved.
Michigan Senate Democrats, in a tweet after Snyder's address, took a swipe: "Crumbling #DPS schools are a direct result of damage that can be done by unelected emergency managers."
Bailey, of the Detroit Federation of Teachers, said, "Emergency Management is not working. If the goal was to destroy DPS, emergency management has done an excellent job."
Earley has said the financial problems with city schools are well-documented and the system's "capital and maintenance programs have been lacking in some areas."
Last week, Mayor Mike Duggan ordered inspections of all the city's public schools. The 20 schools thought to have the worst problems will be inspected by the end of January, with the other schools inspected by the end of April, the mayor's office said.
Snyder, in a posting on his website, said he will work with the Legislature to reform Detroit Public Schools. "The state needs to ensure that a complete failure to educate schoolchildren never again happens to this extent in one of Michigan's districts," he told lawmakers.