Governor Snyder to propose consent agreement for Detroit

Mar 12, 2012

Governor Snyder will lay out details of a proposed consent agreement to members of the Detroit City Council on Tuesday.

Snyder and State Treasurer Andy Dillon, who leads the state review team looking at Detroit’s finances, have suggested a consent agreement for weeks.

That measure could give the city’s elected officials broad powers similar to those of an emergency manager.

City officials acknowledge that without some major action, Detroit will go broke in the next couple of months, with a $45-50 million shortfall expected by early summer. And it’s likely the only way to avoid emergency manager.

Both Mayor Dave Bing and the City Council would have to sign off on a consent agreement.

Bing had been reluctant to publicly endorse the idea, or suggest terms—drawing criticism from some Council members, who said that was the only way the city could achieve the savings it needs to avoid running out of cash.

It also drew more implied criticism from Governor Snyder, who spoke in favor of a consent agreement Monday morning at the “Pancakes and Politics” breakfast in Detroit. He warned that the city was running out of time to fix its own budget problems.

“The thing about doing an agreement—you have to have somebody on the other side agree,” Snyder said, laughing.

“So what I’m looking to do potentially is say “Here’s what I think is the right answer’ fairly publicly. And then let’s get on board and go.”

A majority of Council members have expressed support for at least the idea of a consent agreement.

Bing’s office released a statement about the state’s announcement:

Although we have not been formally notified by the Governor of the Financial Review Team’s recommendation, we have had discussions about the content of a proposed consent agreement, said Kirk Lewis, Mayor Bing’s chief of staff.

The Mayor feels a consent agreement must be structured, “so the City can keep running the City,” as Gov. Snyder said earlier today. The City’s restructuring should be a collaborative effort between the City and State with core authority to carry out the agreement remains with the City.

The Mayor believes the consent agreement the Governor plans to present to the City Council tomorrow should include a process based on accountability and transparency, Lewis said.

The Detroit state review team is also expected to hold a public meeting later on Tuesday to discuss the plan in more detail.