Gov. Snyder: Detroit Bankruptcy A ‘Painful Decision’
DETROIT (WWJ) – It was a difficult and painful decision.
Those were the words of a stone-faced Michigan Gov. Rick Snyder, on the day he approved Detroit’s Chapter 9 bankruptcy filing — the largest municipal filing in U.S. history.
In a video announcement posted Thursday to his YouTube channel, the governor said this development has been “60 years in the making; in terms of the decline of Detroit.”
Snyder said, at this point, he believes that there are “no other viable options.”
Speaking on a media conference call later in the evening, Snyder said said Detroit’s bankruptcy is an opportunity to say “enough is enough” — and to work on improving conditions on the ground for city residents.
“This really gives us a format to say, let’s give them better services, because it really gets back to that last question: What does this for the long-term future? … There’s a lot good things going on in Detroit. There are a lot of positive opportunities,” Snyder said.
“The private sector is doing great work; the foundation community is doing great work. And, by resolving the city government issue … hopefully it’s the last obstacle to saying there’s really a breakout opportunity for growth within the city of Detroit,” he said.
Speaking at a news conference, Detroit’s emergency financial manager Kevyn Orr agreed, saying bankruptcy is the “first step toward restoring the city.”
“What this does do is give us an opportunity to begin to address some of the city’s overbearing debt — which we have discussed ad nauseam at this point — begin to provide the level of services and address the health, safety and welfare concerns of the citizens of the city, and to move forward to fresh start for the citizens of this great city,” Orr said.
Orr added that it’s business as usual in Detroit — city services will remain open, paychecks will be made and bills will be paid.
Orr, a Washington-based bankruptcy attorney, was hired by the state in March after a financial emergency was declared in Detroit.
He estimates Detroit’s budget deficit at $380 million, and the city’s long-term debt at $20 billion.
Bing also spoke briefly to the media, saying, “This is a very, very difficult day for me, as I’m sure it is for a lot of our citizens here in the city of Detroit …. We tried to work our way through this situation over the last four years, but it’s been very, very difficult.”
The mayor, who is not seeking re-election, later issued the following written statement:
“Today’s bankruptcy filing is an unfortunate event in our city’s history. While it has never been my desire that the City file for bankruptcy, I understand why Kevyn found it necessary to do so. I said when I entered office four years ago that our city was in a financial crisis. I also said we cannot simply cut our way out of this situation.
“This action will hopefully be the foundation for the fiscal turn-around of our city. Our citizens have suffered long enough and deserve better. I want to say to the people of Detroit that although we are moving into uncharted waters, Detroit has a history of fighting back during tough times. Hopefully, this is the beginning of a better path forward for our city and our people.”
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