Financial review commission holds first meeting

By Corey Williams Associated Press DETROIT (AP) - The nine-member board that will supervise Detroit's court-approved financial plans was briefed Wednesday on ways the city is improving internal efficiency as it begins its post-bankruptcy restructuring. The presentation came during the Detroit Financial Review Commission's first meeting and included details about a reorganization within the city's information technology office and consolidations under the chief financial officer. The commission has oversight over borrowing and large city-issued contracts. It was created as part of a deal that used money from the state, foundations and corporations to help pay city pensions while keeping pieces in the Detroit Institute of Arts out of the hands of creditors during the largest municipal bankruptcy in U.S. history. "The public is going to be reassured the finances are being handled responsibly," said Mayor Mike Duggan, a member of the commission, after Wednesday's meeting. "We know what we have to do to get out of the control period, and we're going to work on it right now." City Council President Brenda Jones also has a seat on the commission, which is chaired by state Treasurer Kevin Clinton. The commission is modeled after New York City's Municipal Assistance Corp. State legislators in New York created the MAC in 1975 to rescue New York City from imminent bankruptcy. The MAC's board took over the city's finances and was able to borrow billions of dollars on its behalf. The MAC board ended its own oversight in 2008. The role of Detroit's board "may diminish as Detroit gets stronger," Clinton said after Wednesday's meeting. Its next meeting is Nov. 21. The commission "is a serious group" with a very important role, according to former Detroit Councilwoman and political analyst Sheila Cockrel. "The ability for the city to maximize the second chance it's been given rests in financial planning and financial management," said Cockrel. Federal Judge Steven Rhodes last Friday approved Detroit's exit from bankruptcy. The city's restructuring plan eliminates $7 billion in debt and sets aside $1.7 billion to improve city services. Rhodes has scheduled a Nov. 24 hearing to discuss when Detroit's bankruptcy plan takes effect. The city wants to line up certain financing as soon as possible, especially with end-of-the-year holidays looming. More than $100 million in professional fees charged to the city by outside attorneys, consultants and others for their work during the bankruptcy also will be discussed with mediators in early December, Rhodes said. -------- Associated Press writer Ed White contributed to this report. Published: Fri, Nov 14, 2014