Detroit City Council delays vote on contract tied to overhaul

Detroit Mayor says City Council's delay means Michigan won't release $10 million in bond money to city

Published On: Nov 20 2012 10:32:38 PM EST   Updated On: Nov 21 2012 03:50:29 PM EST
Detroit City Council meeting Gary Brown and Charles Pugh
DETROIT -

Detroit City Council members have taken no action on a contract required by Michigan for the city to get cash needed to pay its bills.

The Council voted 8-1 Tuesday to delay a decision on the deal that would pay the Miller Canfield law firm $300,000 to advise Mayor Dave Bing on financial matters.

Bing says the delay means the state won't release $10 million in bond money Tuesday and that "it will be more difficult for the city to maintain its liquidity" until Detroit collects property taxes in January.

"The state has made it very clear that if the city of Detroit did not meet all three milestones as outlined in our agreement, money from the city’s escrow account would not be forthcoming," Bing said in a statement. "The Council’s rejection of the Miller Canfield contract means the city will not receive the first $10 million scheduled for release today.  As a result, it will be more difficult for the city to maintain its liquidity until the receipt of property tax revenues beginning in January. Today’s vote is one more example of how City Council has stalled our efforts to bring financial stability to the city of Detroit."

City Council President Charles Pugh took offense to the mayor's comments.

"For (Bing) to suggest that we are an obstruction as Council really pisses me the hell off," Pugh said. "If the mayor was concerned about getting this $10 million then he should never have tied it to the Miller Canfield contract."

The contract is one of several milestones tied to the city's financial overhaul plan.

City corporation counsel Krystal Crittendon told the council Tuesday that the contract could be a conflict of interest because Miller Canfield wrote the milestone agreements.

The City Council also voted down the no bid EMA proposal, stopping an overhaul of the city's water department.