Detroit workers face unpaid leave Jan. 1
DETROIT — Detroit plans to put workers on unpaid leave starting Jan. 1 to prevent the city from running out of money if its council continues to balk at reform measures and the state blocks the release of much-needed funds.
The furloughs and other cost-cutting measures outlined by Mayor Dave Bing and top city officials this week aim to offset $30 million that Michigan is withholding from the city unless certain conditions are met.
“These actions are necessary to keep the city from falling into further financial distress,” Bing told reporters.
Although the mayor said public safety services won't be adversely affected, details on the furloughs aren't available.
The nine-member City Council has resisted some of the measures to restore Detroit's fiscal health sought by the state and agreed to by the mayor. Earlier this year, Detroit reached a consent agreement with Michigan that gave the state some oversight and allowed the mayor to disregard collective bargaining agreements.
The Motor City, though, has been criticized by state officials in Lansing for slow progress on its financial reforms.
Detroit City Council on Tuesday rejected one of the conditions for the state's transfer of an initial $10 million — the proposed hiring of law firm Miller Canfield Paddock & Stone to help with legal issues related to the financial stability deal with the state. The rejection raises the risk of Detroit running out of money by the end of the year.
Projections presented this month by city officials to an oversight board in charge of Detroit's finances show the city's weekly cash flow at just $4.1 million in mid-December and on course to drop to a negative $4.8 million a week at the end of the year.
Jack Martin, the city's chief financial officer, said the scenario won't happen again.
“The mayor, the administration is planning to implement additional cuts to ensure that the city won't run out of money,” Martin said.
Officials said the city won't miss any payments on outstanding debt. A cash-flow crisis earlier this year led Detroit to warn it could default on some bonds. The default was averted by the sale of new debt that raised $137 million for the city. Michigan has released some of that money to Detroit, with $30 million tied to specific conditions for the release of $10 million this week and $20 million on Dec. 14.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Pair of NYC officers killed in ambush shooting
- IBM’s Watson supercomputing system to be applied to PTSD
- 3-D printed prosthetics give dog ability to run
- Poor morale, training in Air Force ICBM program spur questions about usefulness as nuclear deterrent
- Killer of New York police officers angry over Garner chokehold death, officials say
- Document hunt to begin for illegals who need proof of residency since 2010 for permit, reprieve
- Teenager who attacked California Highway Patrol officer with machete shot, killed
- Cat saved from California storm drain after 2 weeks
- N.Y. reports crime decrease, credits ‘broken windows’
- Financial fraudster used investors’ lucre to freeze dead wife, feds contend
- 4 Afghans freed from Guantanamo