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Published On: Mon, Nov 19th, 2012

Detroit schedule to run out of money in December

Detroit’s financial condition is rapidly deteriorating, and City Hall could run out of cash in December, an official told a state oversight board Monday.

photo/Revisorweb

City program management director William Andrews made the assessment at a meeting of the Financial Advisory Board, a city-state panel overseeing Detroit’s finances under its fiscal stability agreement with the state.

Detroit’s cash-flow crisis is “more challenging than it’s ever been and more challenged than we reported last month,” Andrews said.

The city must find new revenue sources, he said, blaming the worsening outlook on rising medical expenses and lower receipts from taxes and other revenue sources than the city had previously projected.

“Those aren’t materializing,” Andrews said.

Projections show Detroit’s cash on hand dropping as low as $3.6 million by Dec. 21. It stood at $53 million on Friday.

City Council member Ken Cockrel feels Mayor Dave Bing is moving too slowly to control the city’s budget, but he said the state seems to be acting unreasonably.

“To come in now and say we don’t see enough progress, so we don’t know if we’re going to give you the money, that’s kind of like moving the goal post. You can’t tell me that the goal post is here and in the middle of the game move it back yards,” Cockrel said.

Ed McNeil said the concessionary contracts union agreed to last year would have prevented the problems the city is facing now.

“The only answer at this point is to vet the mayor out and the people in Lansing out and you put in place what should have been put in place and the city of Detroit will be fine,” McNeil said.

Detroit city council member Gary Brown disagreed. He said the city has to do more.

“We’re going to have to reduce the number of city employees that are on the payroll and until that happens, we are not going to structurally fix this problem,” Brown said.

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- Writer and Co-Founder of The Global Dispatch, Brandon has been covering news, offering commentary for years, beginning professionally in 2003 on Crazed Fanboy before expanding into other blogs and sites. Appearing on several radio shows, Brandon has hosted Dispatch Radio, written his first novel (The Rise of the Templar) and completed the three years Global University program in Ministerial Studies to be a pastor. To Contact Brandon email [email protected] ATTN: BRANDON

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  1. JoAnn Watson, Detroit Councilwoman wants President Obama ‘quid pro quo’ and ‘some bacon’ - The Global Dispatch says:

    […] On Tuesday, Detroit Councilwoman JoAnn Watson told members of the City Council that since Detroit voted for Barack Obama, the president owes the city a government bailout, Fox 2 reported Wednesday. Detroit is enduring a major budget crisis and may soon run out of money. […]

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