At the Detroit Financial Advisory Board meeting this week, Emergency Manager Kevyn Orr said the city may be best served by him staying past his scheduled end date. “If it’s a few days or weeks thereafter I would certainly hope that everyone would recognize the value of just finishing this out,” Orr said.
Earlier this week, Bankruptcy Judge Steven Rhodes delayed the bankruptcy trial from mid July to an Aug. 14 start date with possible hearing days until Sept. 23. Under Michigan law, the Detroit City Council and Mayor can vote to remove Orr Sept. 27.
“I want to be very respectful of the rights that the council and the mayor have and that will have to be discussed and adjusted,” Orr told WXYZ’s Jim Kiertzner.
Detroit Mayor Mike Duggan told the Detroit Free Press that whatever transition happens will be done “without drama.”
While many of Michigan’s power brokers were on Mackinac Island last week at the Detroit Regional Chamber’s annual policy conference, an alternative event took place in Charlevoix: the Mackinac(ish) gathering. Among other activities, attendees at the “ish” conference streamed speeches from Gov. Rick Snyder and Detroit Mayor Mike Duggan. Here are their observations on what the two elected officials said — and didn’t address.
Detroit Mayor Mike Duggan tells Craig that he has a “good working relationship” with Detroit Emergency Manager Kevyn Orr, and is expecting a smooth transition come October. Duggan supports the state bills for Detroit funding and says it has been a great example of bipartisan support and cooperation.
Speaking of the emergency manager, Kevyn Orr sat down with Craig and reviewed all the current happenings in the bankruptcy case: voting on the plan, incorrect ballots mistakenly sent to some retirees, the timetable for the case, the status of the “Grand Bargain” legislation in Lansing…and more.
Gov. Rick Snyder also came by and tells Craig he approves of the $195 million lump sum provided for in the pending state legislation for the “Grand Bargain” package. “It’s the net present value concept, that’s the old accountant in me coming out,” explains Snyder. However, Craig points out that there could be some potential for new legislation that could involve the Detroit Water and Sewerage Department. Snyder says he does not believe that it would be an appropriate form to use it in, but he does think the current “Grand Bargain” plan will be fundamental in getting “this whole thing resolved.”
It’s far less exciting than the other 11 bills, passed by the House last week, which would provide funding and oversight for Detroit after the city emerges from bankruptcy. Among those is the $195 million appropriation from the state to the pension fund and the proposal to prevent the Detroit Institute of Arts from renewing its existing $23 million annual millage. The bills await Senate consideration.
The special House Committee on Detroit’s Recovery and Michigan’s Future, chair by Walsh, plans a hearing on the bill June 4. The measure adds a paragraph to the existing law that prevents elected officials from holding “incompatible public offices.” The new languages reads:
(This law) does not prohibit the mayor, the chief executive officer, or a member of the legislative body of a qualified city from serving as a member of a financial review commission for the qualified city that is established under the Michigan Financial Review Commission Act.
In simple language, that means Mayor Duggan could name himself as his representative on the committee.
-By WDET’s Sandra Svoboda
@WDETSandra and email@example.com
A standing ovation. That’s what Gov. Rick Snyder got when he asked the Mackinac Policy Conference audience members to let him know if they support Detroit.
Snyder opened his 30-minute address talking about the funding for and restructuring of Detroit that’s provided for in a package of bills. The legislation passed the House last week with broad bi-partisan support and awaits action in the Senate.
“It surprised people that people got on board. It was wonderful to see the breadth of support,” the governor said. He pointed out that representatives from throughout the state “the Upper Peninsula, the Lake Michigan shoreline” voted in favor of the legislation that provides $195 million for Detroit pension funding and requires oversight for the city’s future operation and financing.
“We like to talk about the bankruptcy being over the last year,” Snyder said. “This is our opportunity for a solution for 50, 60 years of problems.”
Snyder said he looks forward to changing the typical conversations people have about Detroit. “They’ll be bringing up things they saw on the national news. In many cases, those things aren’t even right, but that’s the way the discussion goes,” he said.
The governor praised Detroit Mayor Mike Duggan for his presentation at the conference yesterday. An enthusiastic and energetic Duggan gave updates about his administration’s progress on blight removal, street light repairs and additions, increased bus services and other improvements.
“He was marketing Detroit but he was marketing reality, he was marketing facts,” Snyder said. “I need each and every one of you to sign up to be am ambassador for Michigan.”
Following his prepared remarks, WWJ radio’s Vickie Thomas asked her own and moderated audience questions. She started off asking the governor about how he felt now about appointing an emergency manager for Detroit, a move that has been met with some opposition.
“It was the right decision. It was not an easy decision, folks. These were tough calls,” Snyder said. “I wasn’t looking at bankruptcy when I started looking at building a brighter future for Detroit.”
He talked about campaigning in Detroit, holding town hall meetings and meeting with the faith-based community and returned to the topic of emergency management.
“The reason they strengthened the law was to make it so that someone like Kevyn Orr could come in, do their job and get out and have strong, good leadership and have the city continue on instead of having it drag out over time. Let’s get the job done. Let’s do the tough thing, and then let’s get sustainable, solid leadership in a financial situation that’s sustainable.”
-By WDET’s Sandra Svoboda
@WDETSandra and firstname.lastname@example.org
While Detroit’s bankruptcy and revitalization were discussed at the Mackinac Policy Conference (and on the porch of the Grand Hotel), attorneys for the city and several of its creditors were in court in Detroit today, addressing several issues related to the Chapter 9 proceedings and the voting on the city’s Plan of Adjustment.
First, it was revealed that thousands of retirees received inaccurate ballots and will need to vote again, writes Robert Snell in The Detroit News:
The city sent an estimated 2,000 ballots with inaccurate data about money Detroit wants to recoup from current and former workers. The current and former workers, who are covered by the city’s General pension fund, will be sent new ballots with accurate information and get a chance to vote again. “It will undoubtedly result in ‘no’ votes that might otherwise have been ‘yes’ votes,” U.S. Bankruptcy Judge Steven Rhodes said during a hearing Wednesday. “This is very, very unfortunate.
“Who do we hold responsible for this?” Rhodes asked Detroit bankruptcy lawyer Bruce Bennett. Bennett, one of the lead lawyers from the Jones Day law firm, said he didn’t know. Rhodes demanded a name on Friday.
Second, Judge Rhodes said millions of water customers have not paid enough for Detroit Water and Sewerage Department services and could pay more soon. The Detroit News reports:
The 4 million customers across Metro Detroit will pay more if U.S. Bankruptcy Judge Steven Rhodes approves the city’s debt-cutting plan. The failure to pay more for water service led to a shortfall in the city’s pension funds that would be fixed if Emergency Manager Kevyn Orr spins off the utility to Wayne, Oakland and Macomb counties for about $47 million a year. City bankruptcy lawyer Heather Lennox said rates need to be hiked in the city’s debt-cutting plan to pay for capital improvements.
“We are predicting modest rate increases,” she told Rhodes during a hearing Wednesday. A possible spinoff of the Detroit Water and Sewerage Department is one of the more controversial aspects of the city’s restructuring plan.
Detroit’s bankruptcy is far from over.
In court last week, Judge Steven Rhodes questioned Detroit attorneys what would happen with the city’s contract with the Jones Day law firm if the Chapter 9 case isn’t finished at the end of the September. That’s the timeframe Emergency Manager Kevyn Orr has given for his departure from Detroit, and the date he and the judge have had for wrapping up history’s biggest municipal bankruptcy case.
“We have not had discussions to my knowledge going beyond that,” Gregory Shumaker, a Jones Day attorney, said in court. “The mayor, the city council, it would be up to them whether Jones Day would continue its representation of the city.”
Following that exchange, the Detroit Free Press followed up with a story about Mayor Mike Duggan’s plans, reporting a spokesperson said the mayor would not support keeping the Washington D.C.-based law firm beyond Orr’s exit.
Today on Mackinac Island, Mayor Duggan corrected that:
“There must have been some miscommunication here because Oct. 1, I’m quite confident that the City Council is going to terminate Kevyn Orr’s tenure but it makes no sense to terminate Jones Day. They’re in the middle of all the legal stuff. There’s been no conversation about Jones Day,” Duggan told a crowd of reporters.
The mayor also said he continues to work closely with Orr. But while the mayor has control of most of the city operations, the Detroit Police Department remains with Orr.
“Every week I say to Kevyn Orr, ‘I’m ready to run the police department,’ and every week he says, ‘not this week,’” Duggan said.
What’s the hold up?
“You’re going to have to ask him,” the mayor answered.
Orr plans to be on Mackinac Island for a Friday keynote address.
-By WDET’s Sandra Svoboda
@WDETSandra and email@example.com
Of course we never know what any of the speakers might spontaneously say about Detroit’s bankruptcy, but following are a few of the sessions where we expect issues related to the Chapter 9 to be front and center.
WDET will be following the conference at this link.
Detroit Public Television is broadcasting live for much of the conference and can be viewed here.
The first full day of the conference is largely focused on entrepreneurship, but two sessions promise some specific Detroit mentions:
1 p.m. Gov. Rick Snyder speaks as part of official “conference welcome.”
4:45 p.m. Detroit Mayor Mike Duggan will be interviewed by Detroit Free Press columnist Rochelle Riley. DPTV is hosting an online screening and chat during his appearance with Next Chapter Detroit’s Sandra Svoboda as a panelist.
The second day centers on STEM – science, technology, engineering, math – but we’re watching and listening for Detroit bankruptcy topics primarily in the following sessions:
9:30 a.m. Author Malcom Gladwell gives a keynote address and is interviewed by Detroit News columnist Daniel Howes, who has written extensively about the Detroit bankruptcy. As Gladwell’s writing pushes a message of how entrepreneurship and education can help overcome obstacles, he’ll explain how these lessons can apply to Detroit as well as the entire state.
2:45 p.m. Gov. Rick Snyder will be interviewed by Vickie Thomas, WWJ city beat reporter, and is expected to review the highlights of his administration.
5 p.m. WDIV and The Detroit News conducted a survey for the Mackinac Policy Conference, and the results will be discussed at a town hall meeting. They include the statewide view of Detroit as well as attitudes and opinions about this year’s political races and policy issues.
This is the bankruptcy day with several sessions and speakers focused on the topic:
8:55 a.m. New Orleans Mayor Mitch Landrieu, interviewed by WDET’s Craig Fahle, will explain how rebuilding from natural disasters transformed the Crescent City and how lessons learned there could help Detroit’s revitalization.
9:40 a.m. Detroit Emergency Manager Kevyn Orr will be interviewed by Vicki Mabrey, former ABC News correspondent. He’s expected to discuss how Detroit is being positioned for success post bankruptcy and what his plans are toward the city’s long-term sustainability.
10:15 a.m. The panel titled “Detroit Next: Positioned for the Future,” will be moderated by Detroit Free Press editorial page editor Stephen Henderson. Speakers include Detroit City Council president Brenda Jones, Kresge Foundation CEO Rip Rapson, and Jase Bolger, Michigan speaker of the house, and others who will address how “bankruptcy is positioning Detroit to establish financial stability and sustainability and redirect its efforts in city development. With a newly elected mayor and city council in place to guide the city through the post-bankruptcy phase, Detroit offers an environment for unprecedented innovation and collaboration.”
Here’s the link to the full agenda.