And besides, if they are going to do it, they have to do this before the petition to repeal PA 4 (the new emergency manager act) makes it to the ballot. Right?
In April, (Council President Pro Tem Gary) Brown suggested the city enter into a consent agreement with the state that would give Bing more power over the budget without resorting to emergency manager status. A consent decree would give the mayor authority to privatize city operations, sell assets and change ordinances — but wouldn't alter the city's basic governing structure.
Emergency managers, by contrast, are given sweeping powers to fire employees and break union contracts.
Pressure has been building on the Bing administration since an Ernst & Young audit prompted the mayor to suggest he would consider becoming emergency manager if asked to do so by the governor.
The preliminary audit, reviewed by The Detroit News, shows the city is being crippled by plunging property and income tax revenue, a significant dip in state aid and higher payroll and pension costs. The audit suggests the city could have only about $23 million in cash available by the end of the fiscal year on June 30.
The report also points out that revenue-generating ideas included in the city's budget this year — such as increasing fees on booting cars and more aggressive income tax collections — have yet to materialize, leaving the city with a $63 million budget gap. That assessment also assumes $15 million of $25 million in council-mandated cost savings are not realized.
The City Council has canceled their usual holiday break to stay in town for this. Everyone from Snyder on down is proclaiming, "We don't WANT an emergency manager, but..." They shake their heads solemnly, as they make the plans to target union workers and retiree benefits.
Well, everyone except L. Brooks, that is. He is giggling with glee at the thought.
“An emergency financial manager can do things that the mayor cannot do,” Patterson said. “Come in and really vitiate very expensive union contracts, as an example. There’s your pushback — the union officials and union employees don’t wanna see — a financial manager on site because he can do what the financial manager’s done in Pontiac: the police department’s gone, the fire department’s gone; the city clerk’s office is gone. I mean they have tremendous power.”
This is going to be a massive undertaking, and where the chips land, no one knows. But it's pretty safe to say that Detroit, as it's being run today, is about to radically change.
Holds onto your hats and fasten your seat belts. This ride may get a little bumpy, to say the least.
And right on cue: After Bing's speech, we get this:
Mayor Dave Bing laid out a fiscal plan that sought to avoid the appointment of an emergency manager, but the governor responded that he expects the city to begin the process that could end with such an appointment.
After listening to Mayor Dave Bing's speech Wednesday, Gov. Rick Snyder said that the mayor's dire description of finances suggests a state financial review is necessary. It's the first step in the process of appointing someone with more authority than an elected mayor.
"I want to avoid an emergency manager if at all possible," said the governor in a written statement. "Based on the mayor's remarks tonight and the severity of the situation he described, we anticipate he will be submitting a request for a preliminary financial review in the near future."
Snyder did not address the biggest revenue gain Bing sought tonight: The repayment by the state of $220 million Bing says the city is owed from the 1998 deal in which the city agreed to lower taxes on its residents. The state agreed, in turn, to hold the city harmless from revenue-sharing cuts.
That money alone would fix the city's structural deficit and its projected shortfall this fiscal year, he said.
That is the first direct mention of revenue sharing cuts = budget shortfall that may lead to an emergency manager. Thank you Mayor Bing for making that connection.