| NEW YORK
NEW YORK Nov 8 Michigan Governor Rick Snyder is
optimistic that Detroit's bankruptcy case can be wrapped up
during the remaining tenure of the emergency manager he
installed to run the cash-strapped city, he said Friday.
Snyder, a first-term Republican, appointed bankruptcy
attorney Kevyn Orr to an 18-month posting as the city's de facto
chief executive in March, a role that effectively shoved aside
the city's elected mayor and city council.
Then in July, with Snyder's approval, Orr filed the largest
municipal bankruptcy in U.S. history, citing a mountain of debt
and liabilities in excess of $18 billion.
Orr has said he expects to depart by September, 2014 at
which point he also expects Detroit to emerge from bankruptcy.
The federal judge presiding over Detroit's bankruptcy also has
indicated he is seeking to move the case speedily through
Municipal bankruptcies are rarities, and a handful of recent
cases have taken years to resolve. That raises the prospect that
Orr's tenure may expire before the case he orchestrated is
Snyder, in an interview with Reuters during an economic
development tour to New York, said that while he expects the
city to opt to terminate Orr's role at the end of 18 months, he
is hopeful that the case is proceeding quickly enough to allow
it to conclude before that deadline.
"We are on a path to get it done within that time frame,"
U.S. Bankruptcy Judge Steven Rhodes, who is overseeing the
case, "actually moved the schedule up in terms of being more
aggressive, so we are on a path to getting it done," the
Should Orr still be in place when the initial 18-month
appointment expires, Detroit's City Council could ask the
governor to remove the emergency manager from office.
Snyder's comments on Friday came just as Rhodes was hearing
closing arguments over whether Detroit is in fact eligible to
seek Chapter 9 bankruptcy protection, a crucial phase in the
contentious case. A number of the city's creditors, including
current and retired employees and their large pension funds that
account for a large portion of the city's liabilities, have
objected to the bankruptcy filing.
No matter where the city is in the bankruptcy process at the
time of Orr's departure, Snyder said it is important that the
transfer of power back to the city is well executed. Orr was
installed under emergency powers granted to the governor under a
state law enacted in late 2012.
"I think there is a good question to ask what happens after
he leaves, even assuming the bankruptcy gets wrapped up," Snyder
said. "One of the important things is we need to work out the
appropriate transition period."
Earlier this week, Detroit voters elected Mike Duggan to be
the next mayor, a role with little authority during the
remainder of Orr's term but one with enormous responsibilities
after Orr leaves.
Snyder said he and Duggan had spoken since Tuesday's
election, as have Duggan and Orr. Duggan, formerly the head of a
Detroit hospital who will be the city's first white mayor since
1974, has "a strong background," Snyder said. He would not
comment on the substance of their conversation.
The city has seen its population shrink to about 700,000 now
from 1.8 million in the 1950s, when Detroit's three automakers
dominated the industry. In recent years, the city has made
international headlines with its urban blight, roaming packs of
feral dogs and outdated and sometimes inoperable police and fire
Snyder said the city has made recent progress fixing some of
the symbols of its blight, including a recent effort to repair
many of its thousands of broken street lights.