Detroit Officials: Don’t Appoint a Financial Manager Here

The prospect of Michigan’s governor appointing an emergency financial manager for Detroit seems to be looking closer and city officials don’t like it.

Posted: 02/20/2013 01:29 PM EST
Detroit Officials: Don't Appoint a Financial Manager Here

Charles Pugh, the Detroit City Council president and an opponent of the state appointing an emergency financial manager. (Photo: Rebecca Cook/Landov/Reuters)

From the mayor to the city council members, there is no shortage of elected officials in Detroit who are deeply disturbed by the prospect of the city being forced to operate under emergency oversight by a state-assigned financial manager.

Their disapproval comes after a review group appointed by the State of Michigan reached the conclusion that Detroit’s financial problems are significant and deeply rooted. Many officials interpreted that as the step that would lead the state’s governor, Rick Snyder, to put the city’s finances under state control.

“We don’t need one person to come and do this,” said Charles Pugh, Detroit’s City Council president, speaking of the prospect of a state takeover in an interview with BET.com. “We can do this on our own.”

In fact, Pugh said, the city council on Wednesday directed its fiscal staff to explore the options of restructuring the city’s long-term debt. “It’s the governor’s decision as to whether he appoints an emergency manager,” Pugh said. “But we’re providing the governor reports to show that we don’t need one.”

The prospect of an emergency financial manager is a highly controversial issue in Detroit, one with racial and political overtones. Snyder, a Republican, has appointed emergency managers in cities that are largely African-American and largely Democratic.

For example, the governor appointed an emergency manager in Benton Harbor, a Michigan city that is 92 percent African-American. Similarly, in Inkster, Michigan, a city that is 73 percent African-American, an emergency manager was appointed.

Detroit, which is nearly 85 percent Black, would be the largest city in the state to be under the control of the state-appointed manager, should the governor, who is white, make that decision.

“The truth is that emergency financial managers have been concentrated to African-American communities in this state,” said John Olumba, who represents a section of Detroit in the Michigan State House of Representatives.

“There have been financially stressed communities in this state that are not largely African-American that have not had emergency managers appointed, including some cities that have requested them," Olumba said, speaking with BET.com.

Still, Detroit’s financial problems have been severe and ongoing. The city, whose population has dropped from nearly 2 million 60 years ago to slightly more than 700,000 now, is confronting more than $14 billion in long-term debt and frequent shortfalls.

Nonetheless, Detroit’s mayor, Dave Bing, insists that there is no need for state intervention and that city officials can competently handle the challenge.

“I don’t think we want Lansing to come in here and take over, but I’m not opposed to Lansing coming in here, giving us some support,” Bing said, in a recent interview with BET.com, about the administration in the state capitol. “I don’t believe Lansing has given us the kind of support, historically, that we need and deserve.”

Bing was asked if race has had a role in the decisions to appoint emergency managers in the state.

“Race is always a part of it, as far as I’m concerned,” the mayor said.

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