Michigan Treasurer Andy Dillon announced Wednesday that the Department’s preliminary review of the city of Detroit finances resulted in findings of “probable financial stress,” one of the thresholds in Public Act 4 that results in the appointment of a full review team by Governor Rick Snyder.
Among the findings of the preliminary review team were that the city is experiencing cash-flow problems and is projected to run out of cash in April of 2012. Additionally, Mr. Dillon stated that the city has violated the Uniform Budgeting and Accounting rules by failing to account for falling revenue by adjusting budgets.
Members of the review team have not yet been appointed. Sources have indicated that Detroit residents will be included as the Snyder Administration continues to work with Detroit Mayor Dave Bing and the Detroit City Council in the hope that the city officials will be able to come to an agreement with unions representing city employees.
Once appointed, the review team will have 60 days to report their findings. The statute provides for a 30-day extension if necessary. In addition to the Treasurer or his designee, the State Budget Director John Nixon, CPA, or his designee, is part of the review team as well as a member appointed by Senate Majority Leader Randy Richardville (R-Monroe) and House Speaker Jase Bolger (R-Marshall).