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Flint's financial emergency declared over, transition to local control begins

Apr 29, 2015

Flint’s financial emergency is over, and the city is regaining a degree of local control.

Deputy Treasurer Wayne Workman (left) announces the end of Flint's financial emergency. Flint Mayor Dayne Walling is on the right.
Credit Steve Carmody / Michigan Radio

Gov. Snyder issued the order today lifting the city’s “financial emergency” designation.  

“This is a new day for Flint and the city is ready to move toward a brighter future,” Gov. Snyder said in a written statement. “These are important steps as we work together to transition back to local control in the city.”

Flint has been under an emergency manager since 2011.  The city’s budget deficit was once more than $19 million.  A $7 million loan approved today by a state board will pay off the deficit that’s left. 

Flint Mayor Dayne Walling says a “burden” has been lifted from his city.

“I believe with all my heart that Flint is ready for this change,” says Walling.

State and local officials expressed satisfaction at the work that’s been done during the past three-plus years. But some also expressed concerns.

Wayne Workman is the Deputy Treasurer for Local Government Services with the state Treasury Department.  He says Flint’s city finances “are still tight.” 

“Some cuts will have to be found as you go forward,” says Workman, “but things are balanced and the deficit is gone.”  

The city faces challenges.  

The biggest could be the outcome of a federal lawsuit filed by city retirees.  The retirees are fighting the city’s cuts to their health care coverage.  If the city loses, it will have to come up with an additional $5 million a year.  

Also, city tax revenues are not expected to keep pace with rising expenses in the coming years. That could force even more cuts to an already bare-bones budget. 

A board appointed by the governor will be in place with the power to veto decisions by Flint’s mayor and city council.

A host of orders put into place by Flint four emergency managers since 2011 remain in place. Many place restrictions on elected officials.

City Councilman Scott Kincaid hopes to get rid of those orders and move beyond the Receivership Transition Advisory Board during the next two years.

“And to get back to complete home rule as quickly as we can,” says Kincaid.

Receivership Transition Advisory Boards are now in place in Flint, Ecorse, Pontiac, Benton Harbor, Allen Park and Hamtramck.  Detroit is being overseen by a Financial Review Commission.

Inkster, Royal Oak Twp. and River Rouge are operating under consent agreements.

Lincoln Park is the only Michigan city being run by an emergency manager.

As for schools, Detroit, Muskegon Heights and Highland Park school districts are being run by emergency managers. Pontiac and Benton Harbor school districts have consent agreements.