For Immediate Release Friday, Feb. 21, 2014 Contact: Ted O'Neil Media Relations Manager 989-698-1914
MIDLAND — Mackinac Center fiscal policy experts are available to comment on the city of Detroit’s “plan of adjustment,” filed in federal bankruptcy court today.
“Detroit is taking another step toward a new financial beginning,” said Michael LaFaive, director of the Center’s Morey Fiscal Policy Initiative. “Selling off assets and competitively contracting valuable services will help make and keep the city fiscally sound going forward.”
According to the office of Emergency Manager Kevyn Orr, the document will map out how Detroit expects to recover from its $18 billion deficit, the largest municipal bankruptcy in the history of the nation.
Orr’s plan specifically mentions trying to find alternative, revenue-generating uses for Detroit City Airport. A recent Mackinac Center essay addressed this very concept, and Mackinac Center board member Rodney Lockwood discussed his own version of such a plan at a roundtable discussion on Detroit’s post-bankruptcy future that was hosted by the Reason Foundation.
LaFaive more than 13 years ago suggested several solutions to Detroit’s then-looming fiscal problems, including privatization of services and monetization of assets.
“If Detroit had adopted an aggressive privatization program in 2001, it may have avoided today’s bankruptcy battles,” LaFaive added. “The good news is that many of the viable ideas I suggested then can still be part of a workable solution today.”
You can find compilations of the Center’s analysis regarding Detroit here and here, and LaFaive has suggested that Detroit should follow the example set by Pontiac on how to cut costs and streamline services.
Center experts have also explained why Gov. Snyder’s plan to bail out Detroit is misguided.
James Hohman, assistant director of fiscal policy, can discuss why Detroit’s pensions are underfunded and why Detroit has for years received far more state money than it should have.
“Detroit has much in the way of potential,” LaFaive said. “By selling off key assets, contracting out and shutting down unneeded services, the city can move forward in a way that maintains truly vital services and for less.”
LaFaive can be reached at 989-698-1929 or 989-430-8669, and Hohman can be reached at 989-698-1919 or 734-735-9726.