Hamtramck Under Michigan Review

Michigan Gov. Rick Snyder last week appointed a financial review team to examine the finances of the city of Hamtramck, a long-troubled Detroit suburb, after a preliminary review found a serious financial condition.

City officials had requested the initial review.

The appointment of a review team is a step closer to the appointment of an emergency manager. Under the state’s new emergency management law, the team has 60 days to report to Snyder whether a financial emergency exists.

The members of the review team are Ed Koryzno, administrator of the state’s Office of Fiscal Responsibility; Doug Ringler, director, Office of Internal Audit Services in the Department of Technology, Management, and Budget; Eric Lupher, director of local affairs at the Citizens Research Council of Michigan, an independent research firm; Max Chiddister, executive director of the Detroit Public Safety Foundation; and Frederick Headen, legal advisor for the Michigan Department of Treasury.

The preliminary review found that the city has adopted budgets that do not comply with the Uniform Budgeting and Accounting Act and has failed to craft acceptable deficit reduction plans or take any steps to address its structural deficit. The city has also delayed making $2 million in required pension contributions and faces pension and other post-employment benefit liabilities that are “significant obstacles to Hamtramck’s long-term fiscal health,” the state said in a statement.

The city’s fiscal problems have a long history. The state controlled Hamtramck from 2000 through 2007. In 2010, city officials petitioned Michigan officials to allow it to become the first city to file for Chapter 9 bankruptcy --  a request the state denied.

State-appointed emergency managers currently run nine local governments in Michigan, including three school districts.

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