The Detroit City Council is set to reconvene next week to reconsider a vote on a controversial legal contract with public finance firm Miller, Canfield, Paddock and Stone PLC that state officials have said is required before they will release badly needed bond proceeds to the city.

Mayor Dave Bing called the council into special session Monday to take a fresh vote on the contract, which the council rejected last Tuesday 8-1.

But minutes after the meeting began, the city’s law department told the council that the meeting had not been properly advertised, and that any votes would likely violate the open meetings act.

The law department recommended the city re-post the meeting notices and that council meet again. In a statement issued after the meeting, Bing said he would ask for another special meeting next week.

The three-year, $300,000 contract would hire Miller Canfield as special counsel to oversee the financial stability agreement that Detroit signed with the state earlier this year to avoid a state takeover.

Michigan Treasurer Andy Dillon said the contract was one of three measures that the city council needs to approve before the state would release of $30 million of bond proceeds from a state-controlled escrow account.

The state had planned to release $10 million Nov. 20 and $20 million on Dec. 20. Without the council’s approval of the legal contract, the state will not release the money.

City council members last week said they rejected the contract because of conflicts tied to the firm’s role in helping craft the state’s now-overturned emergency management law, Public Act 4, and the city’s financial stability agreement with the state.

In recommending that the meeting be canceled, the law department told council members that it had improperly informed the mayor’s office about how the meeting should be advertised.

“Did [the mayor’s office] even ask the law department — or did they ask Miller Canfield?” joked council member Ken Cockrel Jr.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.