Politics & Government
12:52 pm
Tue March 12, 2013

Detroit leaders say 'a deal's a deal,' don't appoint an emergency manager

At a hearing this morning in Lansing, Detroit city leaders argued against the impending appointment of an emergency manager in the city.

Saying "a deal's a deal," Detroit's Director of Research and Analysis David Whitaker said the state has barely given the city enough time to implement the Financial Stability Agreement.

"In my neighborhood, where I grew up, we were taught 'a deal's a deal.' And I suspect that's the same thing you were taught," said Whitaker.

That binding consent agreement (aka Financial Stability Agreement) was signed off on by both the city and the state less than a year ago (April 5, 2012).

The officials representing the city said the city is working on implementing that plan and that appointing an emergency manager will only delay progress.

Edward Keelan, acting corporation counsel for the city, said the appointment will only be challenged in court.

"It would prevail, that if an emergency manager comes, this would mean another wave of lawsuits," said Keelan.

Keelan said the consent agreement was entered into by all parties with an understanding that implementing it would take time.

The state's financial review team was represented by Fred Headen.

In a calm, measured tone, Headen argued the city has fought the consent agreement ever since it was implemented, and that the progress that has been made was not by choice.

"Most if not all of them would not have occurred if the review team had not been hanging over the heads of the city officials like a Sword of Damacles," said Headen.

City fiscal analyst Irvin Corely argued the state review team exaggerated the city's long term debt.

"It's not as bleak as the financial review team portrays it," said Corely.

He said that around half of the city's long term debt cited by the financial review team ($14 billion) is tied up with the city's water and sewer department.

Corely said much of the debt was the result of upgrades mandated by the federal government, and that there are dedicated revenue streams, in the form of monthly rate payments, to help pay down this debt.

Headen countered that argument, saying the point of their analysis was merely to catalog the city's entire long-term debt problem.

"The city has a staggering amount of debt no matter what the category, that the people of Detroit are going to have to pay back."

Taking a line from Gov. Snyder, Corely argued that the state and city should use "relentless positive collaboration... to modify the city's consent agreement" rather than appointing an emergency manager to oversee things in Detroit.

Mary MacDowell, Deputy Treasurer for the state, oversaw the hour-long hearing and will issue a report to Governor Rick Snyder.