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In his history-making appointment Thursday of Kevyn Orr as Detroit’s emergency financial manager, Gov. Rick Snyder has embarked on a controversial and risky path to fix one of the nation’s most troubled cities.
Orr, 54, is Washington, D.C., lawyer who helped restructure Chrysler during its 2009 bankruptcy. He has undergraduate and law degrees from the University of Michigan.
Snyder, flanked by Bing and Orr at a news conference in Detroit, said "in many respects it's is a sad day," but maintained Orr's arrival is an opportunity.
The governor said he does not view the appointment of Orr as an "act of isolation," but rather as a step in a process of "teamwork and collaboration."
Said Snyder: "The best solution is people coming together."
Orr, who will earn a state salary of $275,000 a year, now heads the largest and most complicated state takeover of a city in U.S. history as opponents – both inside and outside of Detroit city hall – plan to fight him in the courts and in the streets. Some experts say bankruptcy will be the only way to solve the city’s fiscal mess.
"Detroit is a storied city in American history," Orr said. "It's the Olympics of restructuring. It's the right thing to do and the right time."
Like Snyder and Bing, Orr said collboration is the only way to fix Detroit, and he warned a failure to cooperate could have dire consequences.
"Don't make me go to bankruptcy court," he said.
Orr, a Democrat, compared his role as a restrucuring expert to that of an undertaker. "I'm rarely welcome," he said. Switching metaphors, he said that with Detroit, "I've got a patient on the table."
Orr declined to provide any specifics of his plans, saying he would look at the numbers, hold discussions with the mayor and others, make reasoned decisions and explain them to citizens.
"I don't mean to mislead anybody that a restructuring is cost-free. It isn't," he cautioned. He did not say what such costs could be.
Despite the calls for unity from officials, opponents already have held rallies and staged several rolling roadblocks that have caused slowdowns on Detroit freeways, and they have said they will engage in other acts of civil disobedience. With Detroit's majority of black residents, some critics have complained the naming of an emergency manager by the white, Republican governor strips away hard-won voting rights.
Orr must figure out what to do with the city’s $14 billion in long-term liabilities, an accumulated deficit of $327 million and a city government in which almost nothing works properly, from street lights to fire engines to tax collection. Fueling the dysfunction is a tumbling population, which starves city coffers from needed revenue.
The fate of Bing and the nine-person city council remains unclear. The emergency manager has the power to take away their decision-making power and cut their pay, and that is what has happened when emergency managers assumed power in such cities as Pontiac, Hamtramck, Highland Park and Benton Harbor.
Orr did not directly respond to a question about the future roles of city officials, but he said he would "take a reasoned approach and look at the data."
Council members decided Thursday not to file a lawsuit against the emergency manager, but most of its members oppose the appointment, as do the leading candidates for mayor in the fall election. Bing has said for days he can work with an emergency manager.
Bing already has ordered layoffs, cut the pay of many city workers and instituted changes to their benefit packages.
On March 1, Snyder declared Detroit was in a financial emergency and needed an emergency manager. The state and city signed an agreement almost a year ago that set out a plan to reconfigure Detroit’s finances, but state officials have said recently city officials failed to abide by that pact.
Orr expressed his respect for Detroit as an iconic city but didn't say much about his experiences here while he studied in Ann Arbor. He mentioned spending time in Leelanau and learning to ski at Mt. Brighton.
Orr said he believes he can accomplish much in 18 months, after which a super majority of the city council can dismiss him.
He acknowledged, though, "that this job has a fuse on it."
Orr tells Nolan Finley of the Detroit News he is ready to be the "most hated man" in Detroit -- for a while. Read the interview by clicking here.
