Michigan Governor Announces State Takeover Of Detroit
The state takeover will include appointing an emergency financial manager that would have extensive powers over Detroit's finances, including the ability to make further cutbacks to the city's already beleaguered services and sell off some city assets. Large parts of the city have already lost essential services, resulting in a population drop to 700,000 people and large neighborhoods turning into ruins.
The U.S. auto industry, long associated with the city, has enjoyed a resurgence in the last few years since General Motors (GM, Fortune 500) and Chrysler Group went into bankruptcy and received federal bailouts. But the auto turnaround has done little to help Detroit's finances. While GM's headquarters are in downtown Detroit and there is still a concentration of auto plants and suppliers in southeastern Michigan, there are relatively few facilities within the city limits.
“It’s time to say we should stop going downhill,” Snyder said. “There have been many good people that have had many plans, many attempts to turn this around, they haven’t worked. The way I view it, today is a day to call all hands on deck.”
Michigan State Treasurer Andy Dillon told the Free-Press that the state will be able to help fix some of the city's broken streetlights and help remove some of the pay cuts taken by the Detroit Police Department.
"If we don’t restore the morale of the police department and show the public that the police force is functioning well, I think we’ll lose a lot of momentum," he said.
SEE ALSO | Detroit Faces Financial Emergency, State Control
The takeover is unpopular among a majority of Detroit's population, which is predominantly African-American and Democratic in a state led by a white Republican governor. Opponents of the takeover feel that it will eliminate all local control from Detroit and will give the state too much power. Detroit Mayor Dave Bing said that he does not support an emergency manager, but is willing to work with Snyder and state officials.
"“The governor has made his decision, and it was his decision alone to make. While I respect it, I have said all along that I do not favor an emergency manager for the city of Detroit," he said in a statement.
""There needs to be additional conversation with Lansing regarding their plan to move the city forward. We have always said that we need help from Lansing to implement our initiatives such as public safety, transportation, lighting and others. If, in fact, the appointment of an emergency financial manager both stabilizes the city fiscally and supports our restructuring initiatives which improve the quality of life for our citizens, then I think there is a way for us to work together."
The city has 10 days to appeal the takeover, and a hearing will take place on March 12. Many members of the Detroit City Council are already making legal plans to fight against Snyder's attempts to appoint an EFM.