Detroit's emergency manager on bankruptcy developments
On the one-year anniversary of his appointment, Detroit’s emergency manager spoke about the latest developments in the city's bankruptcy in a speech at the University of Michigan.
One thing in the works is getting a $120 million loan from Barclays of London. A state board approved the loan today. The Detroit City Council also approved the deal, despite concerns that the money might be used to pay big-money bankruptcy consultants. But, emergency manager Kevyn Orr says, ‘not so.’
“No. No. The Barclay loan is for quality of life. We’ve already spec’d out what we need for consultants. That’s to go to the quality of life for the city; it’s not used by consultants. So, we’re going to use it appropriately,” Orr responded to reporters immediately after the speech.
The federal bankruptcy judge has final approval on that loan.
Another of the complications in the bankruptcy is selling or leasing city assets in an attempt to reduce Detroit’s debt. Today the city asked for bids from private companies to manage the Detroit Water and Sewerage Department. That’s after the surrounding counties which are served by the department expressed reservations about forming a regional authority to operate the department.
“I continue to believe that an authority is a good resolution. It’s what everybody’s always wanted. It’s what they’ve talked about. For whatever reason, that appears not to be something people want to get involved in and I can’t make them do it," Orr told reporters.
Suburban officials feared they would wind up on the hook for the water system’s operating losses, bad debts, and unpaid water bills. They also said Orr was unwilling to negotiate fairly with them.
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