Cash-strapped Detroit is set to receive $10 million from Michigan after the city council dropped its opposition to a key measure on Tuesday, Reuters reported yesterday. The state has also begun a review of the city's finances that could lead it to file the biggest municipal bankruptcy ever in the United States. Terry Stanton, a spokesman for Michigan's Treasury Department, said the council's action met conditions agreed to by the state and Mayor Dave Bing for the release of $10 million raised through a bond sale earlier this year. The release of another $20 million remains tied to the city's meeting other conditions, he added. Michigan launched a process on Tuesday that could result in an emergency financial manager for the city, who could decide with the state's consent if Detroit should file for bankruptcy protection from creditors. In a 5-4 vote, the council approved the appointment of law firm Miller Canfield to work on issues related to a consent agreement that earlier this year gave the state some oversight of Detroit's finances. Other measures the state has tied to the release of some bond money also received council approval, including contracts for auditing services and for specific audits to uncover potential worker's compensation fraud and to determine dependent eligibility for city benefits. Mayor Bing reiterated that he is working to avoid the appointment of an emergency manager by the state.
