Michigan’s governor, Rick Snyder, finally appointed a emergency financial manager to get Detroit back into financial stability.
Kevyn Orr, a partner in Jones Day, a Cleveland-based law firm, will have power to control all spending, including throwing out contracts, make cutbacks, sell of assets and suspend elected officials salaries.
Snyder said, “I’m confirming my determination of a financial emergency. I’m going to ask the Emergency Loan Board to move forward with the plan of appointing an emergency manager for the city of Detroit.”
However, this does not mean that the city will avoid bankruptcy court. Orr said in a news conference that there was still a possibility of using Chapter 9 bankruptcy to correct the problems within the city. “Don’t make me go to the bankruptcy court. You won’t enjoy it,” he said. “I’m very comfortable in the bankruptcy court. I don’t want to pull that cudgel out unless I have to.”
“We can rise from the ashes,” Orr told a news conference. “This is a beautiful city and a wonderful state that gave me my start. I feel compelled to do this job.” He went on to say, “If we can do this, I will have participated in one of the greatest turnarounds in the history of this country.”
Under state law, his appointment is to last 18 months. But Orr doesn’t expect the turnaround to take nearly that long.
The job “has a fuse on it,” he said. “And If I do a good job, I get fired. I am highly motivated. If we work together, we can get this done significantly shorter than 18 months.”
Orr’s appointment comes after Michigan Gov. Rick Snyder determined that a financial emergency existed in the city, based on the recommendation of a bipartisan review board. Orr’s initial term will last for 18 months, and he will earn $275,000 a year, compared with $158,000 for Detroit Mayor Bing.
Mayor David Bing, a Democrat, supported the move to appoint an emergency manager, by Snyder, a Republican. “Bottom line here, we must stop fighting each other,” Bing said. “We must start to work together. I’m happy now I have teammates.
Detroit has over 700,000 residents and is the largest city in American history to be directly taken over by state government. Some critics are wondering why a city that is in an alleged financial emergency can afford to pay the new manager so much money. From former mayor Kwame Kilpatrick to the highly-paid individuals involved in the pending bankruptcy, are people seeking to profit and pillage from the demise of Detroit? It’s hard to tell.
“The state is not going to be healthy without a healthy Detroit,” Snyder said.
Only time will tell if the city will be better off in the end.