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Ingham
County
Court to
hear
from
Mayor's
law firm
and city
attorneys
on merit
of
'consent
agreement'
DETROIT
(Tell Us
Det) -
Legal
challenges
from
Detroit's
city
attorney,
who is
supported
by a
radical
wing of
City
Council,
has had
a
negative
impact
on the
city's
bond
ratings
in the
credit
market.
Tuesday
downgrades
announced
by the
Fitch
and
Moody's
ratings
agencies
were not
totally
unexpected,
said
Mayor
Bing's
Chief
Operating
Officer,
Chris
Brown.
"Although
the
administration
sought
to avoid
this,
the
downgrade
is, in
part, a
consequence
of the
legal
challenge
of the
Financial
Stability
Agreement
between
the City
and the
State."
The
Mayor's
office
has
hired
Miller
Canfield,
a local
law firm
familiar
with the
consent
agreement
with the
state,-
to file
a motion
to
intervene
against
the
city's
corporate
council,
Krystal
Crittendon,
who is
expected
to file
her
request
today in
Ingham
County
Circuit
Court,
for an
expedited
decision
on
whether
the
consent
agreement
is
legal.
In a
letter
released
by
Crittendon,
she said
claims
that her
request
for a
judge to
decide
whether
her
findings
are
valid
jeopardizes
the
city’s
financial
future
are
“nonsense.”
She laid
the
blame
for the
impasse
over her
legal
challenge
at the
feet of
the
private
law
firm,
Miller
Canfield,
that
Bing
hired to
handle
the
consent
agreement
and the
bond
deal
with the
state.
Crittendon’s
letter
also
says she
was
duty-bound
to
investigate
these
concerns,
at the
request
of
councilwoman
JoAnn
Watson,
who many
feel is
behind
this
firestorm,
felt
that the
state’s
debts to
Detroit
invalidated
the
consent
agreement.
In a
statement
obtained
by Tell
Us
Detroit,
the
Mayor
claimed
Crittendon
exceeded
her
authority
under
the city
charter
and
reiterated
that the
lawsuit
puts the
city's
finances
at
serious
risk.
Tuesday
morning,
Gov.
Rick
Snyder
told the
media,
Detroit
is in a
"crisis"
and if
the city
runs out
of
money,
he's
prepared
to step
in to
protect
the city
and
state.
Snyder
went on
to say
that if
the
agreement
is
breached,
there
are a
"variety
of
steps"
to
follow
through
on.
"If
(city
officials)
fail to
perform
their
part of
the
agreement
or they
have
issues
where
they
don't
perform,
I will
take
action."
Council
President
Charles
Pugh,
who
believes
the
state is
bluffing
said,
"You
don't
put the
city at
risk of
not
being
able to
pay
police
officers,
firefighters
and
scaring
the hell
out of
citizens
saying
we're
going to
run out
of cash.
That's
irresponsible,
and it
makes me
angry
because
we
didn't
have to
get to
this
point."
In
April,
following
the
signing
of the
Financial
Stability
Agreement,
the
general
credit
community,
including
Moody’s,
viewed
the
consent
agreement
“credit
positive”
and as a
result,
reduced
the
City’s
near-term
risk of
bankruptcy.
Now the
city's
bonds
are
viewed
as junk.
"Ultimately,
we are
working
to
restore
our
financial
reputation
with the
rating
agencies
by
stabilizing
the
City’s
finances,"
said
Brown.
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