Detroit is in a "financial emergency" and is close to bankruptcy. This was announced by Michigan Gov. Rick Snyder, reports Huffington Post. Now, Mayor Dave Bing has 10 days to make a new rescue plan for city finances, or Snyder appoint an emergency manager
According to the governor, Detroit‘s financial position is worse than that of any other U.S. city. He added that the position of interim city manager he already has several candidates.
The most likely candidate Snyder described as a man with a very good professional resume. In turn, Bing said that in the course of the governor’s decision and hopes to work on the rescue of the city along with the state authorities.
However, the City Council sees the situation is not as dramatic. The representative body of the municipality believes that the need to work out a solution with the positions of all branches and levels of government. In this case, the city legal department recommended examining on a possible appeal to the court in case of appointment of the managing director.
Now Detroit’s total debt is $ 14 billion, and the budget deficit this year — 327 million. Moreover, without a direct infusion of funds the city is not able to meet its current liabilities by $ 100 million.
Detroit, the automotive capital of the United States is facing a crisis since the 70’s. Compared with 1950, the year the population of the city was reduced by half, and a quarter of the residents left Detroit in the XXI century.
If the city is found to be insolvent, it will be the largest municipal bankruptcy in a long time. In 2011, the bankrupt capital of Pennsylvania, Harrisburg, and three cities in California.