With Detroit teetering over a monetary abyss, Mayor Dave Bing and the city’s new chief financial officer issued a clarion call Friday, warning bluntly that the city will run out of cash next week if a lawsuit challenging the financial agreement the city made with the state to avoid insolvency isn’t dropped.
Calling his frustration level “off the charts” and saying the lawsuit is creating an even worse financial situation than the city was already in, Bing said he has urged Detroit’s top lawyer, Krystal Crittendon, to drop the suit so the city can avoid losing a portion of $80 million the state is threatening to withhold if the lawsuit doesn’t go away.
But, Bing said, by law he cannot force Crittendon to drop the suit.
“I didn’t want to get into a lawsuit — it makes no sense to me, and nobody wins, as far as I’m concerned,” Bing said at a news media briefing Friday. “We’ve spent way too much time on this issue that keeps us from doing the things that we need to do to fix the city.”
The urgency of the financial situation and growing impatience in Lansing resulted in Bing’s push to get together with the council for a closed-door meeting Monday to try to come to some type of consensus.
“If our city runs out of money, there is no bigger crisis that we would have,” Bing said.
But City Council President Charles Pugh said he and many of his colleagues want Crittendon to stand her ground on her challenge of the consent deal. Pugh insisted Friday that it’s not out of brinkmanship, but concern that the city’s consent agreement with the state must be reviewed in court to determine whether it violates Detroit’s own laws governing the conduct of elected city officials.
Pugh said of CFO Jack Martin’s warning that the city will be broke by Friday: “We feel like that may be a bit of an exaggeration.”
Peter Letzmann, a former city lawyer for Detroit, Pontiac and Troy who teaches public administration law at Grand Valley State University, said he doubts Crittendon has the legal standing to pursue the case, which he predicted a judge will toss out.
“I’ve never seen this kind of chutzpah by a city attorney acting without the authority of the mayor or City Council,” Letzmann said.
“They’re turning out the streetlights in Detroit, but we’re spending city dollars chasing what is pretty clearly a frivolous lawsuit,” he said. “They’ve got to stop politicking here. They’re just pushing the city to bankruptcy.”
The battle ultimately could lead to an emergency manager if state officials deem the city to be in violation of the consent agreement. The deal gives the state significant control over Detroit’s finances but prevents, for now, the appointment of an emergency manager who could strip virtually all authority from Bing and the council.
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2 Responses to Detroit To Be Bankrupt This Week If Lawsuit Not Dropped
I’ve lived in the metro area all my life and I still despise the city of Detroit. I was recently in Portland, OR. drinking like a fish when two cops stumbled upon my drunken self and a friend of mine. As soon as we told them we were from the Detroit area they had to ask “Is it really full of burned out abandoned buildings”, to which our reply was “yeah, it’s a shit hole.”. Surprisingly everyone that doesn’t live in the city thinks it’s the greatest place ever.
Surprisingly everyone that doesn’t live in the city thinks it’s the greatest place ever.
Uhhh, no we don’t.