• Detroit financial crisis: Bing, City Council close to deal but pitfalls loom

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    As a deadline looms, a possible deal to prevent Detroit’s insolvency is marred by legal wrangling that threatens to derail hopes of approving a financial stability plan by today.

    Mayor Dave Bing and the City Council finally are close to an agreement — five months after learning the city is on the verge of financial collapse — that could convince Gov. Rick Snyder not to appoint an emergency manager Thursday.

    But hopes of reaching an agreement today are muddied by continuous wrangling between the two bodies and a pair of legal challenges that could throw a wrench in the deal.

    Without that plan, Snyder has two choices: appoint an emergency manager or declare that the debt-riddled city isn’t in a financial crisis.

    As the Bing administration meets with the council today in hopes of striking a deal by Thursday, a federal judge is to hold a hearing on whether the council legally can debate the financial plan, which was hammered out behind closed doors. Union leaders say six council members violated the Open Meetings Act by holding closed-door sessions with state officials over the plan.

    Also Monday, Ingham County Circuit Judge Joyce Draganchuk ordered the Financial Review Team to refrain from voting on a potential consent agreement or meeting to discuss it until a hearing next week. The review team promptly canceled its meeting set for 9 a.m. today.

    Tensions surrounding state intervention flared Monday as council members debated approving a financial stability plan that would give the council and mayor broad new authorities to open union contracts, cut services and restructure government.

    But if the council fails to meet state-set benchmarks in savings, Snyder would have the authority to appoint an emergency manager. That manager would have authority to unilaterally gut union contracts, lay off employees and sell city property such as Belle Isle. The council and mayor’s administration also would likely lose much of their pay and authority.

    Bing’s administration told the council Monday that it is scrapping recently ratified union contracts because Snyder has said he won’t approve any agreement that doesn’t allow officials to reopen contracts. By rejecting the three-year contracts, Bing’s administration is reneging on a pledge to approve the deals hammered out in December and January.

    Read more about the crisis looming in Detroit in the Free Press

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    Originally seen on http://wchbnewsdetroit.com/

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