Dec 21 (Reuters) – Michigan Governor Rick Snyder said on
Friday he will wait on any determination that Detroit needs a
state-appointed emergency financial manager until he gets a
report from a review team in early to mid-January.
The Republican governor assembled the team on Tuesday to
determine if Detroit is in a fiscal crisis and if a manager
should be appointed to oversee its finances. The manager, if
appointed, would then decide if the city should head to federal
bankruptcy court.
Such a move, which the state could block, would result in
the biggest Chapter 9 municipal bankruptcy in the United States.
“I think we will need to take action and that action will
get taken in one fashion or another, hopefully in the most
constructive and positive way possible,” Snyder told reporters
at a year-end news conference.
In the meantime, the governor said he is urging Detroit
Mayor Dave Bing and the city council to work together to fix the
city’s problems.
“They’re in a crisis and they have been in a crisis and the
crisis is getting worse every day,” he said.
A preliminary review concluded last week that Detroit has a
serious financial problem that includes big swings in its
cash-flow projections.
The city of 700,000 has been hard hit by a steep population
decline, years of severe budget deficits and escalating employee
costs, all of which led state officials to begin an intervention
process last year.
That process resulted in a consent agreement that gave the
state some oversight over Detroit, while allowing the city to
avoid an emergency manager.
