Detroit gets Emergency Manager after $14B in Liabilities
Sunday, 03 March 2013

Michigan Governor Rick Snyder has announced that Detroit is so snarled in financial woes the state must appoint an emergency manager to lead it out of disaster.


"There is probably no city that is more financially challenged in the entire United States. If you look at the quality of services for citizens, it's ranked among the worst. So we went from the top to the bottom over the last 50 or 60 years," Snyder told city residents in a town-hall-style meeting that was broadcast live on local television stations across the city.

“It's time to say we should stop going downhill,” he said. “There have been many good people that have had many plans, many attempts to turn this around; they haven't worked. The way I view it, today is a day to call all hands on deck.”


The state-appointed manager, who could be selected this month, would ultimately wield powers aimed at swiftly turning around the municipal government's dire circumstances — powers to cut city spending, change contracts with labor unions, merge or eliminate city departments, urge the sale of city assets and even, if all else failed, recommend bankruptcy proceedings.

After a state report that Detroit is carrying more than $14 billion in long-term liabilities and experiencing nearly annual projections of cash shortfalls, the decision was years — perhaps decades — in the making.


Still, it set off a range of pointed, emotional reactions about whether this was the first step toward true repair in a city that was once the nation's fourth-largest or one last very public sign of a city crumbling.

Some elected city leaders have widely criticized the notion of an outside manager as a takeover of their city and an affront to democratic principles, and they were expected to protest the governor's decision. Under Michigan law, city officials have 10 days to seek reconsideration by the governor, as well as the possibility for a legal appeal in the courts after that.

Snyder said he has a top candidate for the job, someone he declined to name.


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