Detroit In Receivership

[SNWEB]

What's your thoughts on the issue? Do you think it will happen?

[wolverine]

Wouldn't suprise me. Detroit has reached the end of the line. There's no way of getting out of this financial disaster.

[SNWEB]

Well it is fixable,

we have a corrupt mayor who has a security posse and spends wads of cash.

Absolpure water is delivered to city offices, even though Detroit water is one of the best ranked in taste.

City workers mysteriously have tons of overtime hours, 80 hours a week.

Not to mention we waste money on things *cough*broken streetlight boots*cough*

[rbdetsport]

http://www.detnews.com/2005/metro/0504/28/B01-164896.htm

[dnast]

I think Detroit will end up in receivership. It'll be embarrassing, but at least city business would be more efficient.

I almost miss the times when the state was in control of Flint. There weren't any long, drawn-out debates; no "revenge" vetoing; no elected officials filing lawsuits against each other, etc. The state-appointed financial manager just did what he had to do. Sure he'd listen to suggestions and complaints from the administration, council and citizens, but if those ideas weren't reasonable with respect to the state of the city's finances then they would get thrown out the door.

The financial manager didn't have to worry about his political career or whether he'd get re-elected. He even had some power with the unions - by law, they weren't able to "bully" him like they could the mayor and city council.

Three years ago it was "doomsday" for Flint. The state took over, and two years later it was all over. Of course everyone was affected by at least a few of these vital cuts, but the city doesn't seem to be affected much by those choices today. Besides, by the time the financial manager left, there was even a surplus in the budget. The city is now working to get some of its lost police officers and firefighters back on the job.

I'm not saying it'll necessarily go that well for Detroit, but at the rate the city is going, I doubt receivership could hurt the city anymore than it's hurting itself.

(Now we just have to figure out a way of doing this without letting the national media know )

[ironchapman]

I don't live there, but I have relatives tht live just outside of Lansing (I have relatives thatlive all over the country). From what they say, I'd have to vote yes.

Detroit's in something of a sad situation.

Isn't Kilpatrick up for reelection soon.

Him getting reelected...when I think of that, I look like this: ...then this:

[wolverine]

^ Which is probably why Detroit will get receivership

[Zissou]

Now i dont know all the details of what would happen if Detroit was taken over by the state. What I do know is that the state would run the city operations. Is that so bad? The State wont mess around with Detroits corrupt officials. The city government would be downsized to one that fits 900,000 people and not 2 million. Maybe im missing something or dont understand exactly what receivership entails but from what I know im all for it.

Am i missing something?

[dnast]

Well, the appointed financial manager doesn't have to be in constant contact with the state, telling them all of his or her decisions every step of the way and having the state guide them step by step. So there is a chance that Detroit could get a manager that isn't in touch with which cuts residents could deal with the easiest. There's a chance that something like bus service could be more than residents can handle as opposed to other services.

I highly doubt that the state would let too much go out of hand, though, considering that the whole country would be watching if Detroit goes into receivership. I would hope that multiple financial managers would be appointed in Detroit's case if it comes to this.

[Allan]

Somehow I think that a receivership is the only way the cuts that need to be made will actually get made. Kwame certainly isn't going to make any tough decisions....

[wolverine]

Receivership imminent...

The following article was posted at DetroitYes

From Civic Strategies Inc.

Meltdown in Motown

If you're familiar with financial balance sheets, then you know the concept of "net assets." Basically, they're what would remain (in the estimation of auditors) if you liquidated the enterprise and paid off all its debts

[monsoon]

Just keep in mind that NYC almost went bankrupt in the 1970s and even President Ford had given up on the city in refusing to use govt money to bail it out. There was a famous headline - "Ford to City: Drop Dead".

NYC recovered, so it isn't all bad. If Detroit goes bankrupt, then it will force a cleanup of the corruption and incompetence that caused it in the first place.

[Zissou]

  If Detroit goes bankrupt, then it will force a cleanup of the corruption and incompetence that caused it in the first place.

<{POST_SNAPBACK}>

Thats exactly what im hoping for.

[roads-scholar]

Receivership would be the best thing for Detroit. However, be prepared for the inevitable - cries of racism from the ones who want to keep the status quo.

[MrCoffee]

Receivership would be the best thing for Detroit. However, be prepared for the inevitable - cries of racism from the ones who want to keep the status quo.

All I can say, is that change is certain to happen. Everybody is out for themselves when it comes to city government and services. Somebody most certainly has to step in some place if the city is no longer able to govern its self.

I have read where other cities have privatized services, and sold off assets. Perhaps the city of Detroit could give Belle Isle to a non-profit group, for example, that wants to preserve it, and keep it open for all future generations to enjoy. It would save a lot of money for other uses. Believe it, it has worked in other places. A group of preservationists in Minnesota called the Minnesota Transportation Museum, in fact, managed to completely restore a derelict steam trolly boat to like-new condition. Its name is "The Minnehaha" after Lake Minnehaha. They did the same for a street car line, and other ameneties. It would have been imposible for the city government to do those things. Utilities have been fully privatized in Minneapolis for a long time as well.

It might sound tough, but receivership might be the very thing that will save Detroit. Just look at Flint.

MrCoffee

[wolverine]

As great of an asset Belle Isle is, I doubt privatizing it would be Detroit savior. First off, the city has very little assets to begin with. Any money they get to offset part of the debt (and only part of it) would be only a temporary fix. With an ailing tax base, and people still leaving the city, going further into debt is inevitable. So at this point, who cares about assets, and who cares about debt. The problems receivership will solve are the awful corruption that has plagued Detroit's ineffective city government (in all departments) for years. Not to mention, the city government is too larage for the size of what the city has become.

Roads-scholar, you made a very good point. I do expect cries of racism if there is state takeover. But then again, the people who will be complaining are the ones of elected the leaders that made their city worse than it should be.

[SNWEB]

Belle Isle should have a toll to get in IMO.

It would be worth the toll to see the wonderful view and island things and it could mean a cleaner park and maybe even having the aquarium

[Fletch]

I agree that privatization isn't the answer; this is a long-term program, not a short-term live-and-death situation. I also agree that the race card is going to be played by many local officials who no longer can behave like juveniles. It's truly shameful that America's eleventh largest city can get its act together only by essentially trashing democracy. I don't know who to blame more, elected officials or the people who put them there. So, I won't blame anyone in particular. Skyrocketing health care and retirement benefits are bleeding many organizations dry today (just look at G.M.). The crucial variable is union strength and, thus, the ability to squeeze concessions from them. More long-term solutions definitely involve massive municipal restructuring, but where specifically is going to be up to the financial manager. I don't know how one turned around Flint's finances, but if it can be done there, maybe it can work in Detroit too.

[DetroitBazaar]

As if a larger government body will work wonders, or even small wonders. I vote no. The city needs to either die as a result of it's people/leaders or rebound with the same.

[dnast]

Actually, the state government as a whole doesn't do much in this situation. They leave most of the decisions up to whoever is appointed as financial manager(s). That's the only reason I have reservations as to whether it'll be a good thing or not; there's always the chance that Detroit will get somebody who's disproportionately concerned about finances as opposed to the citizens.

The major pluses are that decisions can be made quickly and efficiently since political agendas can't get in the way of progress (nobody can veto anything) and also that financial managers somehow have more power against unions.

I don't know all of the exact details since I wasn't even in Flint when the takeover started, but from reading the news online that's what I got from it before I came back. I'm glad finances weren't left to our former adminstration.

However, if Hendrix gets elected I hope the state takes a wait-and-see approach. It'll still be hard for him to get anywhere if the council persists on voting against practically everything that comes from city administration. He seems like a likeable guy, so hopefully they'll be more willing to work with him.

[peaceloveunderstanding]

well, for one thing, they should not be hosting a superbowl or paying any money to do anything like that.

[Fletch]

Well, dnast, you're essentially referring to a czar. After appointment by the Governor, it seems as if this official can do just about anything to clean up a municipality financially. How could this individual(s) conceivably be fired for misconduct? If a riot broke out in Detroit, could these officials be held responsible? It seems as if this manager could rebuke union contracts. What happens in the event of a strike? All of these scenarios are likely in the near future as Detroit, like Flint, accepts the reality of balanced budgets.

[Zissou]

well, for one thing, they should not be hosting a superbowl or paying any money to do anything like that.

<{POST_SNAPBACK}>

Why? The economic boost the city and area gets is much larger then the cost of putting the event on.

[dnast]

Re: Fletch

Well, I highly doubt that these officials would be let to sit there and destroy the city with the state looking the other way. Although the state doesn't guide them by the hand, the officials do have to report what they are doing.

I won't deny that there is some chance of a riot or strike (I'll admit don't know the exact details of the official's power with respect to unions), but that's why I hope the state takes a wait-and-see approach. If the city's financial situation continues to get worse, hopefully citizens and city workers will see the need for drastic changes.

But if the city can get it done by themselves, then great. It would definitely be preferable to receivership. I just don't know how likely that is.

[DetroitBazaar]

If I'm not mistaking, Pittsburgh went through this as well. The state, in my opionion, while not as corrupt as Kwame and friends, will become another brand of bribery. What keeps people out in many ways is the tax burden and red tape put upon anyone, except "high rollers", who wants to buy a home or build a business. The city owns thousands of parcels of property, why not wholesale them off? Sure they don't know where half of them are, but the other half could generate some revenue. You lower some taxes so that prospective businesses and residents don't opt for Oak Park, Southfield, or even Roayal Oak, and maybe numbers will make up the tax breaks. Meanwhile, selling off idiotic property holdings will generate revenue- only if there is a gaurantee they won't be paying double or more in taxes than they would across 8 mile or Telegraph. Belle Isle could be sold in parcels, it would still be the within the jurisdiction of the city, just like a single family home is, but the city could make some dough. I always thought a dollar per car was reasonable, but obviously others did not. I wouldn't want to see townhomes or condos on Belle Isle, so write that into the contract when selling.

Peace from DetroitBazaar