Detroit to get emergency manager

By Danielle Raykhinshteyn, Daily Staff Reporter
Published March 4, 2013

Republican Gov. Rick Snyder announced Friday that he will soon appoint an emergency manager for Detroit.

Snyder spokesman Caleb Buhs said the governor decided to implement an emergency manager after a financial review team for Detroit suggested the action.

He added that Snyder agreed with the recommendation because not much progress has been made in Detroit following the consent agreement made last year, which allowed elected officials to stay in power and created a financial committee to oversee the budget.

“Their long-term liabilities are large and getting larger, and they have a deficit that’s also growing and consistently in a cash-flow crunch,” Buhs said.

Buhs said Snyder’s main goal is to get Detroit back to a high-functioning state. He added that Detroit is on a path to recovery with investments such as the M-1 Rail.

“There are good things going on, the finances just need to be fixed once and for all in order for those investments to continue,” Buhs said. “That’s what the governor would hope for — that we can once and for all solve some of these financial problems so that Detroit can get back to the great city that it once was.”

Detroit has until Mar 11 to request a hearing with Snyder to plead its case as to why it doesn’t need an EM. If a hearing is requested, it would take place on March 12. If a hearing is not requested, the governor can be expected to appoint a manager soon after. A final decision on who the manager would be has not been made.

The decision to assign an emergency manager to Detroit has been controversial due to the original emergency manager law, known as Public Act 4, which was struck down by the voters last November under Proposal 1 on the Michigan ballot, only to be replaced with a new law, Public Act 436.

State Rep. Jeff Irwin (D—Ann Arbor) said while he feels Snyder has been thinking about appointing a manager for some time, Irwin doesn’t think the appointment will be an effective way to help the city.

“Most (emergency managers) have actually driven their municipalities further into debt,” Irwin said. “Obviously it’s a bad thing for the city of Detroit. It’s a great city with a really proud history, and I think everyone’s hoping that Detroit is able to come back and have resurgence and be a part of the state’s future.”

Irwin views taking away the power of elected officials as a way to punish the city, not a way to help it succeed. He added that he doesn’t see an appointment as the state of Michigan backing up the city.

“A better plan of action is more regionalism and more of an effort for the state to get behind the city of Detroit, rather than to essentially punish the city for the effects of globalism and urban decay, white flight, all of the problems that Detroit has had for many, many years,” Irwin said. “All of those problems are really larger than the city of Detroit. “

Tom Ivako, administrator of the Ford School of Public Policy City and Local, State and Urban Policy, said he thinks the public is generally against the emergency manager law, though legislators are mixed. Snyder has implemented the law simply because the consent agreement wasn’t making progress.

“In the case of Detroit I think (Snyder) went through plan A, which was the consent agreement and gave it, in his mind, all the time that he could afford, which was close to a year, and simply didn’t see the kind of progress that he thought was required,” Ivako said. “The emergency manager has become Plan B, and he simply ran out of time with plan A.”

Ivako said he sees both successes and failures with previous emergency managers. He added that the main point of the failures is that emergency managers are not a long-term solution.

“Most local leaders think that the system of funding local government is broken,” Ivako said. “That raises the question of whether or not an emergency manager can come in and make short-term fixes that can get a jurisdiction back on track. Until that situation is resolved, it simply leaves the local government back in what most local leaders think is a broken system funding.”

Political Science Prof. Michael Traugott said although this is a “relatively unusual circumstance” because Detroit is major city, he is interested to see who Snyder would pick to be emergency manager and ultimately thinks appointing one would be a good decision.

“It will be good for Detroit primarily because they don’t seem to be able to solve these financial problems on their own,” Traugott said. “It’s a complicated decision because it involves a loss of power and authority, but it’s the best way, probably, available to put them on sound financial footing.”

Follow Danielle Raykhinshteyn on Twitter at @dannierayh.