Earlier this year, Krystal Crittendon, a Detroit Corporation Counsel had brought a lawsuit challenging the validity of the financial stability agreement the city had with the state on the grounds that the state was more than $230 million in arrears to Detroit. That suit had been dismissed in June by a state judge ruling that only the mayor or the city council had the locus standi to file the lawsuit.
That ground of rejection would be removed, if city voters approve the new charter measure empowering the city counsel to file lawsuits objected to by the mayor or the city council.
Sara Wurfel, a spokeswoman for Governor Snyder expressed dissatisfaction with the move, saying, “Unlimited, unchecked discretion of corporation counsel isn’t sound policy overall.”
Mayor Dave Bing supports the financial stability agreement and had objected to the lawsuit brought by the city counsel. A minority of councilmembers who rejected state oversight in response to the fact that Detroit was rapidly running out of cash while the State held millions in arrears.
However, the lawsuit had held up a bond sale dearly needed to help the city, and with the dismissal of the lawsuit, the Michigan Finance Authority sold $129 million of bonds for the city in August. Apparently, Detroit’s pact with Michigan is aimed to restoring fiscal health to the city by allowing state oversight – but there’s the matter of hundreds of millions of dollars in arrears, which could have saved Detroit anyway, had the state solved that angle.