Snyder names Kevyn Orr as Detroit emergency financial manager

(DETROIT FREE PRESS) Gov. Rick Snyder this afternoon introduced Detroit to the man he is entrusting to help fix the city's financial mess and avoid a bankruptcy of the Motor City.

Snyder reaffirmed his determination that a financial emergency exists in the city and that an emergency manager is needed to correct it. He named Kevyn Orr as the person he wants to hold that position. The state's Loan Board voted 3-0 to appoint Orr as Detroit emergency financial manager this afternoon. He will be paid $275,000 by the state of Michigan.

"I make this decision after careful and thoughtful deliberation," said Snyder, flanked by Orr and Mayor Dave Bing, whom Snyder thanked for partnering with him and agreeing to work with Orr.

Snyder said he will recommend Orr to be approved later this afternoon by the state's emergency loan board based on Orr's ability to work with people cooperatively, great technical skills and a record of tough decision making

"I don't view this as an act of isolation. This is not about asking one individual to come in and turn around the city of Detroit. This is a problem that has now reached a true crisis point ... This is an opportunity for us to work together, to bring people together as Detroit, Michigan."

Detroit became the largest city in U.S. history to be taken over by its home state with today's appointment of Orr, 54, a high-powered Washington, D.C., lawyer and University of Michigan graduate who worked on Chrysler's 2009 bankruptcy restructuring.

He will oversee efforts to stabilize a city flailing under more than $14 billion in long-term liabilities, an accumulated deficit of $327 million, a plummeting tax based and unprecedented population loss.

Orr said he will resign from the Jones Day law firm in Washington where he is a partner.

"Let's get at it and work together," Orr said.

"I am highly motivated. If we work together we can get this done in a rather short period."

Ahead of the appointment, the mood was somber this morning at the Coleman A. Young Municipal Center.

The City Council decided earlier today to not challenge Snyder's appointment in court.

Council met this morning in public, with Councilwoman JoAnn Watson making a motion to hire the Sugar Law Center to possible pursue a legal challenge in either Wayne or Ingham counties. The council went into a closed session at 11:30 a.m. to discuss the matter. After the closed session, the council emerged and Watson withdrew her motion.

Council President Charles Pugh said other legal challenges - not by council - are possible. Council members Jenkins, Kwame Kenyatta and Brenda Jones did not attend.

In a decision that has prompted protests and anger, a state review team last month declared Detroit in a financial emergency from which it can't recover without state intervention.

Detroit joins Flint, Hamtramck, Highland Park, Pontiac and Benton Harbor as cities that have been taken over by the state amid financial crises. Detroit's public schools are also under an emergency financial manager, as the district's student population fell amid the declining fortunes of Detroit, which has faced unprecedented population loss and a severe fall in tax revenues.

Some of Detroit's Lansing delegation said they felt the city should have been given more time to correct the fiscal problems, instead of having an EM appointed.

"The council presented a convincing and compelling case to continue the consent agreement. I feel they didn't receive a fair hearing and due process. The city of Detroit and its citizens deserve the opportunity to continue on that path without the interference from an emergency manager," said State Rep. Thomas Stallworth, D-Detroit.

"In the minds of Detroiters, they feel like an emergency manager is going to come in and fix their quality of life and nothing could be further from the truth. An emergency manager's job is to fix the spread sheets. And that doesn't deal with crime or emergency response times, abandoned homes and blight or that my trash is getting picked up at 11:30 last night. How is an emergency manager going to fix those issues," said state Rep. Harvey Santana, D-Detroit.

 

Detroit Free Press