Blog: Moving Detroit Upward with an Emergency Financial Manager

By Governor Rick Snyder | March 14, 2013

Bing Snyder Orr

The people of the City of Detroit are suffering a financial crisis that affects their everyday lives -- street lights that aren't on, police and fire response times that are too slow, and buildings that stand vacant.

Today I have recommended the appointment of an emergency financial manager to help bring this crisis to an end and start moving Detroit upward again.

How We Got Here

Last month, an independent financial review team submitted a report detailing the scope of the city's fiscal crisis. I reviewed that report and agreed with the team's conclusion that Detroit is in a financial emergency. The facts show that the city has a short-term cash crisis, a long-term debt crisis, and an inadequate plan to solve the problem.

This week, the city had an opportunity to appeal those findings and correct any information in the independent review team's report.

As the record from Tuesday's hearing shows, the conclusion remains the same: there is a financial emergency in the City of Detroit. As such, I believe it's appropriate to move forward.

Our Next Steps

Under Michigan law, when a city is in a financial emergency, an emergency financial manager can be appointed who can take actions to bring that emergency to an end.

It's not a step that is taken lightly, but it's one that's not without precedent. Since 1990, governors from both parties have appointed emergency financial managers in cities and school districts across the state. In fact, emergency financial managers have taken actions in Royal Oak Township, Hamtramck, Highland Park, Flint, the Village of Three Oaks, Detroit Public Schools, Pontiac, Ecorse, Benton Harbor, Highland Park Schools, Muskegon Heights Schools and Allen Park.

In Detroit, the emergency financial manager expects to serve for 18 months, at which time city officials will have the opportunity to assess progress and determine next steps. The manager will look at the facts, hear from the people of Detroit, and take actions to address the financial emergency as quickly as possible.

I am pleased that the state's Emergency Financial Assistance Loan Board (ELB) has agreed with my recommendation and appointed Kevyn Orr as EFM for the city of Detroit. He has extensive experience in dealing with difficult financial problems and solving them. Kevyn has roots in Michigan, knows the state, and has exceptional experience in government and the private sector.

On top of all that, he understands the need to work collaboratively with Mayor Dave Bing, the City Council, key stakeholders in Detroit, and the State of Michigan to solve the city's financial problems. He's also focused on the same thing that we are: doing what's best for the people of Detroit.

That Detroit has reached this point is a sad moment, but it's also one of optimism and promise. There was a time when Detroit was the most prosperous city in America, when it put the world on wheels, when it stood as the Arsenal of Democracy. Today, we have an opportunity to help make Detroit great again, but it will take all of us working together to bring about a bright and exciting future.