DETROIT -

The state has found that "probable financial stress" exists in the city of Detroit, moving the state's largest city one step closer to the possible appointment of an emergency manager.

State Treasurer Andy Dillon sent a letter to Gov. Rick Snyder Wednesday alerting him to the finding. Dillon recommended the appointment of a full financial review team, the next step in the process.

The financially struggling city of Detroit just last week delayed paying some of its vendors and contractors to fund payroll.

Snyder has said he'd prefer that Detroit officials enter into an agreement to fix the financial problems on their own. But he may appoint an emergency manager if the review team recommends one.

Detroit Mayor Dave Bing released a statement Wednesday in response to the appointment of a financial review team.

"Following one of our regular and ongoing meetings this morning, Gov. Snyder informed me that he has decided to move forward with the appointment of a financial review team," Bing's statement read. "As I've said many times before, this action was not unexpected. There is nothing in the findings released today that we or the state were not previously aware of and that we have been addressing. We will continue to fully cooperate with the review process. However, I firmly believe that the remedy to the city’s financial crisis is my plan that seeks savings of $102 million for this fiscal year and $258 million in fiscal year 2012-13. Key components of my plan include structural reforms in health care and pensions, work rule changes and wage reductions. We will continue to negotiate with union leadership with a goal of forging an agreement soon."

For more information about PA 4, visit the Local Government Fiscal Health page on the
Department of Treasury’s Web site at www.michigan.gov/treasury.