Mayor Dave Bing is seeking $125 million to $150 million in a short-term loan from the state to help fix the city’s [Detroit’s] fiscal crisis, Bing’s office confirmed Thursday night.
Bing’s request follows his State of the City speech Wednesday night where he vowed to keep an emergency manager out of the city and called for “tangible support” from the state, including financial and operational support.
Bing’s intention to ask for the loan was first reported Thursday by the Wall Street Journal.
“I think the governor is pretty coy,” Bing told the Journal. “If Detroit fails or doesn’t make it or doesn’t come back as soon as we would like it too, it’s going to cost the state money anyway. It’s you pay me now or pay me later.”
Asked about the possibility of a state-financed bailout of the city, Snyder said this week in an interview with The Detroit News: “That doesn’t make a whole lot of sense if there’s not a solution” to the city’s long-term financial troubles.
“This is to have a sustainable answer,” he said. “This is not to put off a situation until it becomes a problem again,” Snyder said.
The push is on to get city officials to enter into a consent agreement to restructure the city’s finances, with Snyder saying Thursday he’d like a deal done this month.
Significant cash assistance for Detroit would need to be appropriated by the Republican-led state Legislature.
One Senate Republican source said it’s unlikely Republicans would approve funding for Detroit, saying there is “no political will” for a bailout.
Asked whether it would be a wise investment of state tax dollars to give Detroit a cash-infusion, the governor reiterated: “Not unless there’s a long-term plan to success in place.”
The city is on course to run out of cash by next month and faces nearly a $50 million shortfall by May.
Snyder’s 10-person financial review team has until March 28 to recommend that either an emergency manager or a consent agreement be reached.
“What we really need to do is get a consent agreement done,” Snyder said. “I don’t want to get in a situation of having a financial manager in Detroit. The mayor doesn’t either. … And what we really need is an agreement between the mayor and City Council coming together with the state to say here is the plan and here is what’s going to be implemented.”