Detroit’s Gap Is Growing

Detroit could face a budget deficit of up to $150 million, nearly $75 million more than estimated under previous Mayor Kwame Kilpatrick’s administration, according to the city’s new chief financial officer.

New Mayor Ken Cockrel Jr. is expected to announce a plan to tackle the shortfall within the next several days.

Among the possibilities is reviving a proposal to sell deficit bonds to plug the hole, according to the Detroit Free Press, which first reported the budget deficit after an editorial board meeting with the new mayor.

Another proposal would be based in part on Kilpatrick’s plan to sell the city’s half of the Detroit-Windsor Tunnel. Under a revised plan, the city would sell the rights to the tunnel fare revenue — roughly $700,000 a year — in exchange for an upfront, one-time cash payout, according to reports.

Meanwhile, yesterday was the deadline to file petitions for those interested in running for the city’s top post. Among those who were expected to file yesterday were Cockrel, well-known Detroit businessman Dave Bing, former Kilpatrick attorney Sharon McPhail, and state Rep. Coleman Young 2d, son of the former Detroit mayor. A number of other candidates have also thrown their hats in the ring, and altogether nearly 40 others took out petitions, but as of yesterday many had not yet filed with the city clerk’s office.

For reprint and licensing requests for this article, click here.
MORE FROM BOND BUYER