Gov. Rick Snyder: Allen Park financial emergency resolved

Governor appoints Receivership Transition Advisory Board  

Thursday, Sept. 25, 2014

LANSING, Mich. – Gov. Rick Snyder today announced that the financial emergency in the city of Allen Park has been resolved and appointed a Receivership Transition Advisory Board to help ensure a smooth transition and guide the city to continued financial stability.

“I am very pleased to accept Joyce Parker’s recommendation that the financial emergency in Allen Park has been sufficiently addressed and that we can begin the process of transitioning back to local control,” Snyder said. “As a critical first step, members of the newly-appointed Receivership Transition Advisory Board will work cooperatively with local leaders to ensure continued financial stability and growth in Allen Park. This is a great day for city residents.”

Parker, who was appointed emergency manager on Oct. 29, 2012, notified the governor Wednesday, of her determination that the city’s financial emergency had been sufficiently addressed. Parker cited several factors and accomplishments, including:

  • The city’s structural and cumulative deficits have been eliminated while ending the most recent fiscal year with a projected fund balance of $3.6 million.
  • Purchase agreements for the sales of the City Hall property and Southfield Lease Properties were executed, generating an estimated $15.5 million in savings and/or new revenue for the city.
  • Employment contracts and/or EM Orders are in place with all bargaining units. Additional savings have resulted from a 10-percent reduction in pay for active employees, the elimination of vacant positions, the consolidation of healthcare plans from five to two, and an increase in co-pays and deductibles.
  • The city secured a $2.6 million emergency loan to fund outstanding pension obligations.

Parker had previously enacted a two-year budget for the city and this morning issued her final order as emergency manager. The order outlines responsibilities of elected officials and their collaboration and cooperation with the advisory board.

“It has been an honor and a privilege to serve the residents of Allen Park,” Parker said. “We have taken some difficult but very important steps to address the city’s financial emergency and I believe Allen Park is on solid financial footing for the foreseeable future. I am also pleased to remain involved with city officials and residents as a member of the receivership transition advisory board.”

In addition to Ms. Parker (Department of Technology, Management and Budget director designee), advisory board members include Suzanne Schafer, administrator of Treasury’s Local Audit and Finance Division (state treasurer designee), Frederick Frank, owner/principal, Frederick Frank, Attorney and Counselor (representing persons with relevant professional experience), and Kristine Barann, vice president of finance, Baker College of Allen Park (representing persons with relevant professional experience).

Parker and representatives from the Department of Treasury will hold a media conference call with reporters at 2:30 p.m. today. To participate in the conference call, credentialed members of the media should call the Department of Treasury Communications Office at 517-335-2167 for call-in information or contact Terry Stanton or Jeremy Sampson via e-mail (stantont@michigan.gov or sampsonj@michigan.gov).

For more information about Public Act 436 of 2012, the Local Financial Stability and Choice Act, visit the Local Government Fiscal Health page on the Department of Treasury’s web site at www.michigan.gov/treasury.

#####