Tagged: Detroit financial crisis

The Michigan Court of Appeals today lifted a temporary restraining order that prevented the state financial review team for Detroit  from meeting.

The court’s move has opened the door to a major step in fixing Detroit’s city finances.

The financial review team, appointed by the governor,  was supposed to meet Tuesday to vote on a “consent agreement” that would restructure the city of Detroit’s finances.

The agreement would help the city avoid the appointment of an emergency manager, but would require painful budget cuts.

With EM decision fast approaching, Detroit City Council will meet again tonight

Instead of voting on a proposed financial stability agreement with the state, Detroit City Council members spent much of Tuesday discussing several court challenges that could derail any agreement. They eventually adjourned without a vote on the agreement despite warnings that tabling a vote could lead to an emergency manager appointment by Gov. Snyder. Snyder's deadline to decide on an EM appointment is tomorrow. Michigan Radio's Sarah Cwiek was at the meeting and reports council plans to meet again tonight.

Last night, Deputy Mayor Kirk Lewis, who has been filling in for Mayor Bing while out on medical leave, issued this statement regarding council's discussions:

We appreciate the seriousness with which the Detroit City Council is deliberating. This is one of the most critical decisions in this City’s history. However, Mayor Bing and the administration believe Gov. Snyder will act on Thursday, April 5, according to law, regardless of any related, current legal challenges to the process.

Auto sales on pace for a strong year

It's early yet, but auto sales figures in the U.S. show automakers are on pace to make 2012 the best sales year since 2007. More from the Detroit Free Press:

New-vehicle sales ran at a 14.4 million annual rate in March, down from a four-year-high of 15.1 million in February. Still, at the pace so far, Americans would buy 14.5 million vehicles this year, up from 12.8 million in 2011. The increase equals more than six assembly plants running two shifts each.

Chrysler led all automakers in sales gains for the month of March at 34.2 percent.

Michigan's unemployment rate drops across areas of state 

Michigan's unemployment rate dropped to 8.8% last month with a slight uptick in overall employment as well.

Michigan Radio's Steve Carmody reported new data shows the decline occurred throughout the state:

Fifteen of 17 regions of Michigan recorded declines in unemployment in February, with Detroit and Monroe reporting the largest rate decreases from January to February. Flint, Holland and Jackson recorded the largest declines during the past year.

No clear path forward in Detroit

Detroit City Council met yesterday afternoon and did not vote on a proposed financial stability agreement with the state. Instead, as Michigan Radio's Sarah Cwiek reports, the meeting "started out with a contentious public hearing about union contracts, and ended in a confusing mess of court challenges—with no clear answer about how the whole process will go forward."

Council is expected to meet again today starting at 10 a.m.

Gov. Snyder has said his deadline for deciding whether or not to appoint an emergency manager is this Thursday (April 5).

And today at 2 p.m., according to the Detroit Free Press, a federal court will hear arguments about whether Gov. Snyder's "pressure on the city to scrap ratified [union] contracts violates federal due-process rights and contract clauses in the federal and state constitutions."

A separate court hearing on potential violations of the state's open meetings act is set to take place next week (April 11). As Sarah Cwiek reports:

Ingham County Circuit Court Judge Joyce Draganchuck has ordered the review team not to approve or even discuss a consent agreement before an April 11 hearing.

The court order was called “disturbing” by officials in Gov. Snyder's office. They say they will appeal.

Judge blocks legislative maneuvers by State House Republicans

Republicans in the State House have passed 500 bills with "immediate effect" provisions. With this provision, laws go into effect immediately after the Governor signs them, rather than waiting 90 days after the legislative session ends.

To pass an "immediate effect" bill, the legislative body needs a super-majority, which it does not have. 

Democrats in the State House sued, saying the Republican majority in the State House refuses to hold recorded votes on "immediate effect" bills.

As Michigan Radio's Steve Carmody reported, Ingham County Circuit Court Judge Clinton Canady granted a temporary injunction against the legislative maneuver. Her order blocks the implementation of three bills already signed into law.

An emergency manager for Muskegon Heights schools?

With a projected deficit of more than $9 million, a state financial review team is recommending that Gov. Snyder appoint an emergency manager for the school system.

Unlike Detroit, an EM appointment here is not likely to be controversial. The school board took the unusual step of asking for an emergency manager appointment last December.

Gov. Snyder has ten days to act on the review team's recommendation. If one is appointed, the Muskegon Heights schools emergency manager would be the seventh emergency manager operating in the state.

 DETROIT (AP) — A judge has issued a temporary order to block a state-appointed team reviewing Detroit's finances from meeting Tuesday.   The panel was expected to vote on a proposed "consent agreement". 

The order was issued late Monday afternoon by Ingham County Judge Joyce Draganchuk. 

The order brings to a standstill the process that was expected to result in a "consent agreement" for the city of Detroit.

Update 11:06 a.m.

In addition to threatening to strike, AFSCME officials say they will also file a federal lawsuit to try and compel Detroit City Council to take a vote on the tentative agreements the unions bargained for.

Unions are also in federal court seeking a restraining order. They're trying to prevent the Detroit City Council from signing off on a consent agreement.

10:49 a.m.

Time is running out for Detroit and state officials to reach an agreement to stave off an emergency manager.

This morning, Deputy Mayor Kirk Lewis confirmed he won’t ask the City Council to approve new labor contracts for city workers.

That infuriates union leaders, who gave up historic concessions in an effort to save money and avoid an emergency manager.

Al Garrett, President of the American Federation of State, County, and Municipal Employees in Detroit, said this is about breaking unions, not Detroit’s fiscal crisis.

"People don’t have to come to work if in fact their rights are being abridged," said Garrett. "It is not unusual for strikes in the city of Detroit, and I’m pretty sure that they may be met with some stiff opposition with regards to taking away rights that folks have had for years."

Gov. Snyder has said those concessions don’t go far enough. Under a proposed consent agreement, city officials would have broad powers to skip collective bargaining and impose union contracts.

EAST LANSING, Mich. (AP) - Gov. Rick Snyder's chief of staff says more concessions will be needed from Detroit unions before a financial oversight deal can be worked out with city leaders, but he adds "we're moving strongly forward" toward agreement.

Dennis Muchmore said during Friday's taping of public television's "Off the Record" program that he thinks five of nine city council members ultimately will approve a deal between the state and the city. At the moment only three have publicly expressed support.

If an agreement isn't reached by next Thursday, Snyder will have to decide whether to appoint an emergency manager with sweeping powers to run Detroit. Muchmore says an appeal period starts then, so the absolute deadline on a decision isn't until April 13.

Council members are expected to vote early next week.