SAGINAW (WWJ/AP) – A Michigan school district that says it can’t afford to pay its teachers has decided to lay off employees and cancel classes Tuesday as it works on a plan to educate students.

The Buena Vista School District, located just outside of Saginaw, said in a posting on its website that school is closed Tuesday and a community meeting is Tuesday night.

READ MORE: Boil-Water Alert Could Last 2 Weeks For Some In SE Michigan

The Michigan Education Association says the district’s board voted Monday night to lay off employees.

“Faced with a selfless offer of help from their employees to continue working, without the guarantee of a paycheck next payday, Buena Vista’s school board and administration gave up on their students and employees and laid everyone off,” MEA President Steve Cook said in a statement.

Buena Vista Education Association President Joe Ann Nash said in a telephone news conference Monday that the district’s 27 teachers would work this week in the hopes that the state and the school district can come up with a plan to keep classes in operation.

“To the dedicated teachers and education support professionals in Buena Vista, MEA will continue to stand by you and your decisions to do what’s best for your students and your families. While your offer to work this week was the right thing to do, your thanks has been a pink slip from an employer who doesn’t have any money to pay for your continued work — and a cold shoulder from a state that clearly doesn’t value your contributions or the students you serve,” Cook said.

READ MORE: 133,000 People Remain Under Boil Water Advisory In Michigan, Could Take Weeks Before Water Is Safe To Drink

The school district in Saginaw County announced last week that it won’t be able to make payroll on May 24 because the state has put a hold on its funding to recoup about $580,000 for a juvenile detention education program the district no longer operates. Teachers will receive their final paychecks on Friday.

Michigan started withholding money in April and will continue to do so through part of July, state Department of Education has said.

Enrollment has declined from more than 900 in 2010 to about 400 this year. The school district has been in debt since 2011, with its deficit reaching $1 million last July, the state said. In addition, the Buena Vista district will owe the state about $2 million in loans in August.

According to the school district’s website, it is taking steps toward confirming a financial emergency, which could lead to an emergency manager being installed to help bring the school out of debt.

MORE NEWS: Salvation Army Collecting Supplies For Back To School Drive

TM and © Copyright 2013 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2013 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.