* Team appointed by Snyder slated to meet on Monday
* Michigan governor glad for more time to work out deal
* Detroit mayor undergoes surgery
(Recasts with background)
By Ben Klayman
DETROIT, March 24 Michigan's Court of Appeals
has cleared the way for a team appointed by the governor to come
up with a consent deal to keep afloat Detroit, America's
historic "Motor City," which could run out of money in months.
The pressure on Detroit is intense. Monday is the deadline
for Governor Rick Snyder's team to recommend what to do to fix
the dire financial situation for Michigan's largest city, long
synonymous with the U.S.-based auto industry.
Detroit and the state of Michigan have been negotiating to
try to stave off the appointment of an emergency manager for the
nearly bankrupt city.
Those talks, which continued on Saturday, were given a boost
when t he court late on Friday reversed an order from earlier in
the week that questioned whether the team could meet in private
and barred it from issuing a recommendation until a hearing set
Also on Saturday, Detroit Mayor Dave Bing had successful
surgery to repair a perforation of his intestines and designated
his chief of staff as acting mayor while he recovers.
A spokesman for the city said Bing, 68, was resting
comfortably and was still involved in talks to reach the consent
Detroit's finances have been crumbling due to a steep
population drop, sinking revenue and a huge debt load.
The city has faced hard times for decades. Detroit
was home to nearly 1.9 million people in the 1950s, but now has
a population of about 714,000, shrinking its revenue base. With
the U.S. auto industry's contraction, the city lost 25 percent
of its population between 2000 and 2010.
Once the recommendations are issued, Snyder has 10 days to
act. The 10-member team, which includes state Treasurer Andy
Dillon, is slated to meet on Monday afternoon.
If a consent agreement is not reached, the state could cut
off revenue-sharing funds or appoint an outside emergency
manager to run Detroit.
A spokeswoman for Snyder said the administration was
"thankful" the appeals court had allowed the review team to work
toward a resolution of the financial crisis.
"Resolving this crisis in a timely matter is crucial for the
residents of Detroit," Geralyn Lasher, Snyder's spokeswoman,
said in a statement.
Snyder has said repeatedly he does not favor the option of
appointing an emergency manager for Detroit.
Bing, who is expected to remain in the hospital for five to
seven days, can resume limited administrative duties as early as
Sunday, a city spokesman said.
OPPONENTS OF STATE TAKEOVER
Opponents of any kind of state takeover of the city were
"We obviously are still very, very concerned about state
occupation of Detroit," Rainbow Push Detroit President Reverend
D. Alexander Bullock said. "I'm worried that now there will be a
top-down, paternalistic approach to public policy that will
displace the democratic process."
Andrew Paterson, an attorney for Robert Davis, a local
school board member and union activist who challenged the
financial review team in court, said, "We will review this
hastily issued order and will be considering our legal
Detroit's long-term liabilities are estimated to top $12
billion, while the city's annual budget is put at about $3.1
Both Fitch Ratings and Moody's Investor's Service slashed
the city's ratings and said more cuts were possible as the city
and the state of Michigan struggle to agree on a plan to keep
the city from running out of cash.
On Friday, roughly half of Detroit's unionized public
employees accepted pay cuts and other concessions to save $68
million a year, actions a spokesman for Snyder said did not go
far enough to address the city's long- and short-term troubles.
The agreements announced on Friday did not include Detroit's
police and fire unions, which also had tentative deals.
(Reporting By Ben Klayman, Tiziana Barghini and David Bailey;
Editing by Peter Cooney)