Tagged: Andy Dillon

Governor Snyder and other state officials have told Detroit this week it needs to accept a consent agreement to avoid going broke.

A draft agreement has been presented to the City Council. It would give the state a great deal of say in how Detroit is run.

But lots of politics stand in the way of reaching an agreement.

The consent agreement State Treasurer Andy Dillon has crafted for Detroit—the only “official” proposal out there right now--can be seen in one of two ways.

The state team reviewing Detroit’s finances has avoided a scheduled court date—and possible contempt of court--by disbanding a controversial sub-committee.

An Ingham County Circuit Court Judge had ordered the team to appear in court Monday.

Detroit Mayor Dave Bing says the city is “at a critical and pivotal time like none in Detroit’s history."

But during his third annual State of the City address, Bing gave few details about how he’ll deal with the city’s most immediate threat: running out of cash.

Bing said both he and Governor Snyder “agree that an emergency manager is not the best option” for Detroit.

The state review team looking into Detroit’s finances met in public for the first time Tuesday.

But the meeting was short—less than 20 minutes--and revealed almost nothing about the process behind the review.

The team, led by State Treasurer Andy Dillon, briefly reviewed Detroit’s bleak financial picture--without major changes, the city will run out of cash before the end of the fiscal year. There was also a brief public comment period.

Update 1:32 p.m.

Another update from MPRN's Rick Pluta. In this morning's status conference, Ingham County Circuit Court Judge William Collette told the attorney for State Treasurer Andy Dillon that he would rather the state not hold any financial review meetings until he rules whether these meetings have to adhere to the state's Open Meetings Act.

The judge said he's inclined to rule that closed door state financial review meetings violate the Open Meetings Act, but he's waiting to hear the state's argument. State attorneys have not filed their paperwork yet.

The state agreed to the judge's wishes saying they weren't planning to hold any financial review meetings prior to next week's hearing anyway.

11:49 a.m.

MPRN's Rick Pluta followed up on this story for more clarification.

He spoke with Judge William Collette's assistant this morning, and with Andrew Patterson, the lawyer representing the plaintiff.

There was no official ruling from Judge Collette, as WXYZ in Detroit had reported.

Judge Collette only held an informal meeting with the two sides arguing the case this morning (Andrew Patterson and a lawyer representing State Treasurer Andy Dillon).

The plaintiff is Robert Davis, the board secretary of the Highland Park School District.

Davis said the state's financial review team violated Michigan's Open Meetings Act by holding private meetings, failing to post public notices for the meetings, and for failing to keep minutes of the meetings.

Davis wants the judge to void the recommendations of the state's financial review team that led to the appointment of an emergency manager for Highland Park schools.

The state maintains that closed door meetings are allowable for the financial review teams and for emergency managers.

Judge Colette informed the parties this morning of his inclination in the case.

He said, in his initial judgement, it appears the Michigan Open Meetings Act applies to emergency manager meetings and meetings held by the state's financial review teams.

Judge Colette directed those arguing the case to prepare their arguments for a hearing he is expected to hold next Wednesday morning. It's also possible that the parties will reach an agreement prior to a hearing.

10:10 a.m. 

The Chief Judge of Ingham Circuit Court has ruled indicated that Governor Snyder and State Treasurer Andy Dillon cannot hold closed meetings with regard to emergency mangers and financial review teams, according to WXYZ in Detroit:

Treasurer Dillon had previously announced that the Emergency Manager process was not subject to the state's "Open Meetings Act."

The ruling means that the state financial team can no longer meet in private. The public must be allowed to be a part of these meetings.

We'll have more on this story as it develops.

*Correction - an earlier version of this story stated that Chief Judge Collette issued a ruling. He only held an informal meeting with the parties this morning. We put strike-throughs on the incorrect text above. A ruling, or an agreement is expected sometime next week.

Update 3:29 p.m.

The Associated Press has this report on reaction from Detroit Mayor Dave Bing:

Detroit Mayor Dave Bing says the city already is working to address financial problems detailed by a new state review.

Bing says in a statement Wednesday that the city plans to "fully cooperate" with the state's financial review process. His comments came after the state announced it had found that "probable financial stress" exists in the city of Detroit...

Bing has said Detroit faces a $150 million budget deficit and a projected $45 million cash shortfall, but argues that progress is being made without state oversight. He is seeking concessions from city unions and says Wednesday the goal is to forge an agreement "soon."

12:34 p.m.

"The longer it takes to address Detroit's financial problems, the more painful the potential solutions become." - State Treasurer, Andy Dillon

Michigan State Treasurer said today that their preliminary review of Detroit's finances found the city to be in "probable financial stress."

More from MPRN's Rick Pluta:

Governor Rick Snyder will order an intensive review of Detroit’s finances now that a team from the state Treasury has determined the city is in “probable financial stress.”

It is the next step in a process that could wind up with the governor naming an emergency manager to run the city.

State Treasurer Andy Dillon said the administration still hopes Mayor Dave Bing and the city council can come up with its own plan that would avert a state takeover.

“It’s our number one hope that the city, the city council and labor can make its own deal that the state is not be part of, but, so that we’re ready for the event of maybe a cash shortfall in April, we thought it necessary to have the formal review process run in tandem with the progress that the city’s making,” said Dillon.

A report highlighted last month by Detroit Mayor Dave Bing found that without changes, Michigan’s largest city could run out of money sometime in April.

The Detroit Free Press reports on what the preliminary financial review found:

Dillon said in a report the city had violated the uniform budgeting and accounting act by not adjusting its budget on a timely basis and had not filed an adequate deficit elimination plan. He also cited a mounting debt problem, trouble making payments to pension plans and the possibility the city will be short of cash by April...

Dillon said in his report that “city officials are either incapable or unwilling to manage its own finances.” Also “as we have noted on numerous occasions, the longer it takes to address Detroit’s financial problems, the more painful the potential solutions become,” he said.

After the next review, an emergency manager could be appointed to run Detroit.

Governor Rick Snyder and members of his budget team visited New York to meet with the agencies that set the state’s credit rating.

The state’s rating suffered due to the effects of the decade-long recession.

It's bond ratings are not that bad, but they could be better.

Governor Snyder traveled to Wall Street with state Treasurer Andy Dillon and Budget Director John Nixon. They made the case that Michigan deserves an upgrade because it’s overhauled its business tax and wrapped up its budget months ahead of schedule without resorting to accounting gimmicks and one-time fixes.

Sara Wurfel, the governor’s press secretary, said “one change in a state’s bond rating can actually mean millions of dollars in lower payments.”

The governor’s itinerary included meetings with Moody's, Fitch Ratings and Standard & Poor's. The meetings only opened the discussions with Wall Street, and Wurfel says there will be further negotiations as the governor tries to reduce the cost to taxpayers when Michigan borrows money.