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Full Financial Review Next Step For Detroit

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DETROIT (WWJ) – Detroit is now one step closer to the possible appointment of an emergency manager. The State of Michigan has been pouring over the city’s financial situation and finds “probable” distress exists.

State Treasurer Andy Dillon, Wednesday morning, discussed his department’s preliminary review.

“The findings are there is probable financial distress for the City of Detroit, which means we can now move forward to the formal review,” Dillon said.

Dillon sent a letter to Governor rick Snyder alerting him to the findings.

The next step: Dillon is recommending the appointment of a team to conduct a full review of Detroit’s finances. That panel will include some Detroit residents.

Detroit, just last week, delayed paying some of its vendors and contractors in order to find payroll. The State believes, and Mayor Dave Bing has said, the city will run out of money by April.

Work by the review team will run parallel to continued discussions between unions, Detroit City Council and other city leaders.

Earlier Wednesday, several on the Detroit City Council told WWJ’s Vickie Thomas that they believe Gov. Snyder really does not want to appoint a financial manager for Detroit because of huge payments that would be due, related to the city’s bonds.  That could be anywhere between $4 million and $8 million, according to council members speaking to Thomas.

Congressman Hansen Clarke says an emergency takeover would take away the voting rights of Detroit citizens — rights that many of their ancestors had to fight to get.

He’s not giving up fighting a state takeover, and says he’s sponsored legislation that could prevent it from happening.

“And that’s a bill that I’ve already introduced in the U.S. House of Representatives. I have over 30 members of Congress who have signed on to support that bill,” Clarke  said. “That would allow the federal taxes that Detroiters pay to the IRS to be redirected to a trust fund instead.”

The fund would give the city up to $2 billion a year to pay off its debt, cut local taxes and invest in job training.

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