State Finds 'Probable Financial Stress' in Detroit
State officials said Wednesday that they've found "probable financial stress" in Detroit, moving the state's largest city one step closer to the possible appointment of an emergency manager.
LANSING, Mich. -- State officials said Wednesday that they've found "probable financial stress" in Detroit, moving the state's largest city one step closer to the possible appointment of an emergency manager.
State Treasurer Andy Dillon sent a letter to Gov. Rick Snyder Wednesday alerting him to the finding. Dillon recommended the appointment of a full financial review team, the next step in the process.
Financially struggling Detroit just last week delayed paying some of its vendors and contractors to fund payroll. Auditors have said the city may run out of money in April. Snyder has said he'd prefer that Detroit officials enter into an agreement to fix the financial problems on their own. But he may appoint an emergency manager if the review team recommends one.
"I conclude that probable financial stress exists in the City of Detroit and recommend appointment of a financial review team," Dillon said in the letter, which he also distributed to media.
An email seeking comment was sent to a spokesman for Mayor Dave Bing.
Snyder and Bing met Wednesday morning to discuss steps the city is taking to solve its financial problems without a financial manager being appointed.
"There is real progress," Dillon said during a conference call with reporters. "Everyone is willing to look at every possible solution."
He added he expects that the formal review process "will begin in earnest" early next month.
"We're very focused on the date when we think they run short of cash, since that affects our timeline. We're watching that very, very closely," he said.
Dillon expects to forward a list of people to Snyder on Wednesday or Thursday who might serve on the review team. The governor will decide when to appoint that team.
The review team is likely to consist of Detroit residents with "financial acumen" and who would be viewed favorably by Detroit residents, Dillon said. The team will take "a deeper dive" into the city's finances and will involve interviews with city department heads, city council members and others.
Copyright 2011 The Associated Press.