Tag: DIA

Reposted from The Mackinac Center for Public Policy in time for Rick Snyder's State of the state address tonight:

Don't Bail Out Detroit with State Tax Dollars

Unfortunately, there may be a hook: A requirement that the state treasury contribute, which would convert voluntary private generosity into a coerced taxpayer bailout.

A state bailout of Detroit is a terrible idea. It creates moral hazard and adds to the overly generous financial support the city has for years received from state taxpayers.

Christies is supposed to have a valuation of the city owned art for Detroit emergency manager Kevyn Orr this week.  

Spoken like a CPA with a law degree.

Long-time readers are aware that this inevitable outcome was as plain as day to most local observers like myself, and borrowing a page from the President, want to make this as process as painful as possible to the principles involved, so that the actions which have caused it are never repeated again.

Ever!

Yes, the EM appointed by Gov. Snyder has brought some baggage with him.

Yes, he has made a few enemies along the way.

Yes, even the Governor himself has drawn himself into the fray by how the EM is compensated and most importantly by whom.

But in his defense, he has made some tough decisions which needed to me made.

Staffing is being addressed.

Benefits are being brought to a manageable level, given the resources available to the Detroit.

Assets are being looked at. And when appropriate, are being used to pay off the debts incurred by the city due to it habitual fiscal ineptitude.

The latter isn't really making any new friends with those in charge of overseeing Detroit's Art Museum, a collection wholly owned by the City of Detroit.

Yes, I'm talking about the DIA.

Long-time readers may also recall how the DIA managed to successfully con the Tri-County Region into believing that the DIA was in the poor house and ram through a regional art tax to fund their little operation.

With their meal ticket now in jeopardy because two of those counties aren't keen on taxpayer money going to bailout Detroit, a fact they were repeatedly warned about when the respective county boards placed this tax on the ballot, the DIA Board is looking at new ways to pull their collective fat out of the fire.

You're going to love what scheme they have come up with this time.

The bizarro side of the world is wondering what you might be up to, but we have less tolerance for the games.  Don't play on their turf, because at some point you will realize all the friends you brought with you are gone. A realization of the truth will make short work of this:

"Consistency and the state constitution demand that Attorney General Bill Schuette fight to protect the pensions of Detroit retirees from being downsized in bankruptcy court. It's Schuette's job to defend state laws, and he can't pick and choose which ones he fights to protect.

Schuette filed Monday to intervene in the bankruptcy proceedings on behalf of pensioners.

The move puts him at odds with Gov. Rick Snyder, who supports Emergency Manager Kevyn Orr's position that retirees will have to sacrifice along with other creditors to resolve Detroit's $18 billion debt."

The Michigan Constitution has many things that need to be enforced, but Article 9 Section 24 cannot be used in this case. The average Joe can tell you that Article I, Section 8, Clause 4 of the US constitution says so.

"Both state legislation and state courts tended to use debtor-creditor laws to redistribute money from out-of-state and urban creditors to rural agricultural interests. Under the Articles of Confederation, the states alone governed debtor-creditor relations, and that led to diverse and contradictory state laws. It was unclear, for instance, whether a state law that purported to discharge a debtor of a debt prohibited the creditor from trying to collect the debt in another state. "

The constitution of the US is primary. Federal bankruptcy law which is derived from specific mandates it is absolute under this example.

There is no constitutional protection. If anyone can find it in the 1963 (current) Michigan State Constitution, please feel free to point it out.  I must concur with McLellen's statement:

"Republican barrister Richard McLellan, a state constitutional expert, said the constitution's language regarding pensions does not bind the state to protect pensions of municipal employees.

"It doesn't say the accrued and financial benefits are guaranteed by the state -- it doesn't say that at all," McLellan said."

And the aging/deteriorating legal brain of Frank Kelley saying so doesn't make it the truth.  Frankly, even in his BEST years, Kelley overlooked rampant corruption at all levels in Detroit, allowing the city to fall into the condition we now find it.

Detroit pensioners, you HAD your chance.

It seems the state has been overlooking a fundamental restriction already in place when certifying election results for 5+ year millages and Bond requests.  Has there been a validation for electors established to determine if the right to vote on certain issues?

Typically, those who show up for an election for a millage are unchallenged as to their ability to vote on such issues.  There are no instructions that stipulate the law, as established by the constitution REQUIRES a real stake in such issues printed on the election forms (ballots), and there are no alternate means to prevent abrogation of constitutional statute.  The Michigan Constitution is very clear:

ARTICLE II
Elections

§ 6 Voters on tax limit increases or bond issues.

Sec. 6. Whenever any question is required to be submitted by a political subdivision to the electors for the increase of the ad valorem tax rate limitation imposed by Section 6 of Article IXfor a period of more than five years, or for the issue of bonds,  only electors in, and who have property assessed for any ad valorem taxes in, any part of the district or territory to be affected by the result of such election or electors who are the lawful husbands or wives of such persons shall be entitled to vote thereon. All electors in the district or territory affected may vote on all other questions.

History: Const. 1963, Art. II, §6, Eff. Jan. 1, 1964.
Former Constitution: See Const. 1908, Art. III, §4.

A question we should be asking might be: "Is a passed millage request subject to legal challenge based on the inability to verify the legal status of the electors voting on such issues?" In other words, if you don't own property you cannot vote on a bond issue, so is your ballot restricted, or not?

Detroit's assets and connected operations are ALL potential targets of a chapter 9 bankruptcy. Wheter its the electric service or an island, OR a publicly financed display of polished feces on a marble stand. The Detroit News reports of Kevyn Orr's warning to Detroit Administration that nothing is 'off the table':

" The city's new emergency manager has told the Detroit Institute of Arts it may "face exposure to creditors" if the city is forced to seek bankruptcy protection, a spokesman said Thursday night.

"This is a precautionary measure," said Bill Nowling, spokesman for Kevyn Orr, the city's emergency manager.

Nowling said while there is "no plan on the table to sell any asset of the city ... it is possible that the city's creditors could demand the city use its assets to settle its debts."

All of the warnings of financial collapse to the Detroit administration and city council have fallen on deaf ears for decades. For those same decades, the answer has been to personally raid the city piggy bank, allow infrastructure to fail, and the voters have rewarded that decision making with reelection and support; reinforcing bad decision making.

Clearly its time to cut the city loose to its destined end.