Tuesday, March 20, 2012

Court Ruling Temporarily Blocks Consent Agreement in Michigan

March 20, 2012 at 5:57 pm

State to appeal ruling blocking Detroit consent agreement; review team meets Wednesday

By Karen Bouffard and Darren A. Nichols
The Detroit News

Mason— The state plans to appeal a judge's ruling blocking a proposed Detroit consent agreement, and the team reviewing the city's finances will meet Wednesday to "discuss possible options," the state Treasurer's Office said Tuesday.

The review team will meet at 1:30 p.m. at Cadillac Place in downtown Detroit in hopes of moving forward with a Monday deadline to submit a recommendation to Gov. Rick Snyder on Detroit's financial future, state Treasurer Andy Dillon said in a statement.

"It was hoped the city would submit language early this week that could be considered by the review team," Dillon said. "However, we've not received the city's proposal and the review team must move forward with the information and options that are available."

Earlier Tuesday, the Snyder administration said it was "disappointed" by Ingham County Judge William Collette's order barring Dillon and Detroit's financial review team from approving a consent agreement until the judge holds a contempt hearing March 29.

"I am disappointed with today's ruling, which only serves to delay a potential solution to Detroit's financial crisis," Dillon said. "The court's decision completely disregards critical financial issues facing the city and potentially limits options available to the review team. Detroit is in a financial crisis and the time for action is now."

Under the state's emergency manager law, the review team must recommend to Snyder by March 26 whether the city should enter into a consent agreement, get an emergency manager or declare bankruptcy.

Activist Robert Davis, who filed a lawsuit against the review team alleging it violated the state's open meeting laws, asked Collette to consider contempt charges. He alleges the review team met in secret following an injunction earlier this month banning private meetings by the team.

Davis called Tuesday's order "a major victory" because now the review team cannot recommend the consent agreement until after holding a contempt hearing.

"It means they can't do anything. They can't do what they were trying to do," Davis said.

Snyder spokeswoman Geralyn Lasher said the governor's office has not yet received a copy of the written order and it needs that to determine how to proceed.

"However, we would point out that the review team must have their work completed by March 26 and are disappointed that it seems that this judge in Lansing has little concern for what the statute outlined," Lasher said in an email to The Detroit News.

Detroit Mayor Dave Bing issued a statement on the ruling Monday saying: "The city respects the judicial process and will simply follow the judge's order."

Dillon, in Detroit on Monday speaking to religious leaders and activists, was unaware of Collette's ruling, but said it could "potentially" change things and that "I'd have to talk to our lawyers to see how they'll respond to that."

He said he planned to call state Attorney General Bill Schuette "to see what the recommendation is."

According to Andrew Paterson, an attorney representing Davis, Collette entered the order after lawyers representing Schuette filed a motion to adjourn a contempt hearing set for Thursday.

"The judge said, 'I'll give you the adjournment but I'm issuing an order enjoining Andy Dillon or the mayor from entering into the consent agreement (in the meantime)," Paterson said.

"Frankly, I think (the review team) is going to be held in contempt and they're not going to have the ability to enter into an agreement after that date," Paterson said.

Some Detroit City Council members applauded the decision Tuesday afternoon and questioned how the consent agreement was conceived.

"I think the judge made a good decision," Councilwoman Brenda Jones said. "If you read the law, the law says the consent agreement should be coming from the review team, and the consent agreement (instead) was given to me by Andy Dillon.

"My understanding is the consent agreement was supposed to come to us from the review team. Where is the consent agreement that the review team has come up with, and did they come up with it in an open meeting?"

Added Councilman Kwame Kenyatta: "Where did this so-called consent agreement come from? Did somebody stay up late one night and form it or did the review team? It is a question of how did this thing come up in the first place and it went around the law. They are not even following their own law."

Council President Charles Pugh said the uncertainty surrounding the emergency manager law reinforces the need for the city to work through its issues, rather than seeking to reach a consent agreement.

"This is all like a big soap opera," Pugh said. "Our goal is to not run out of cash, and we're thinking about the fiscal stability of Detroit. We care more about not having a payless payday and fixing the structural issues we're dealing with.

"I will let this whole court matter over Public Act 4 (and) the consent agreement take its course, but in the meantime we need to continue meeting with the Mayor's Office to present a viable fiscal plan that fixes our crisis."

(517) 371-3660
Detroit News Staff Writer Leonard N. Fleming contributed

No comments: