Detroit aid package clears first major hurdle in Lansing

May 22, 2014

The $195 million state contribution to the Detroit bankruptcy settlement cleared its first major hurdle today, as the state House approved the payment by a wide margin.

Credit Lester Graham / Michigan Radio file photo

Applause erupted as the final bill in the Detroit package was approved by a lopsided majority. 

There were plenty of complaints about parts of the bills – such as years of post-bankruptcy state oversight, and the big withdrawal from the state’s “rainy day” savings.

The package also includes financial oversight requirements that could last for many years.

“Imposing this legislation on the city of Detroit is not right,” said State Rep. David Nathan, D-Detroit. “This is something that the city of Detroit, the elected officials that are here, will have to live with for a very long time if this passes. The vote that they take will be a vote for oversight and takeover of the city of Detroit.”

But supporters of the aid package said there’s too much at stake to say “no” to the settlement.

“Do you really want to open the gates of financial Armegeddon and see what’s on the other side?” said state Rep. Harvey Santana, D-Detroit. “Do you really want to do that? Do you really want to play chicken with this situation?”

That “other side” included the prospect of pensioners forced onto welfare, auctioning off city-owned artwork, and additional months or years of litigation.

The 11-bill package now moves to the state Senate, where hearings could begin next week. Governor Rick Snyder and legislative leaders say they want the state’s part in the deal wrapped up by early June.