The financial emergency in the city of Flint has been resolved and a Receivership Transition Advisory Board has been appointed to ensure a smooth transition to local control and continued financial stability for the city, Gov. Rick Snyder said.
“I was pleased to receive and accept Jerry Ambrose’s recommendation that the financial emergency in Flint has been sufficiently addressed,” Snyder said. “This is a new day for Flint and the city is ready to move toward a brighter future. These are important steps as we work together to transition back to local control in the city.”
Snyder said Ambrose, and those who preceded him, worked diligently to finalize several critical reforms in the city, so it can return to local control. The Receivership Transition Advisory Board appointed today will work closely with local leaders to ensure Flint continues on a path toward long-term financial stability.
Ambrose notified the governor Tuesday of his determination, noting numerous accomplishments in Flint since a financial emergency was declared in November, 2011:
- Deficits in both the General Fund and Water Fund have been addressed, with a $7 million GF deficit to be eliminated through a loan authorized by the Local Financial Assistance Loan Board this morning.
- Long-term liability costs have been reduced from $850 million to $240 million. Multipliers for remaining employees with defined benefit pension plans have been reduced with new employees enrolled in a hybrid pension plan.
- New ordinances addressing long-term financial sustainability have been enacted by City Council with support of the mayor, including a strategic plan; a biennial budget and five-year financial projections; and, establishment of a fund balance reserve, including establishment of a budget stabilization fund.
- The structure of the city organization has changed significantly. A city administrator has been hired with expanded control over daily activities. The workforce has been reduced by more than 20 percent with city operations to better reflect and meet current needs.
- In November 2014, voters approved revisions to the current charter and approved establishment of a Charter Review Commission, which will consider the city’s future form of governance, including whether to create a city manager.
Ambrose had previously enacted a two-year budget for the city and issued his final order as emergency manager this morning. The order outlines responsibilities of elected officials and their collaboration and cooperation with the RTAB.
The new board includes:
- Frederick Headen, legal advisor to the state treasurer (state treasurer designee).
- Brian Larkin, director at Flint and Genesee County Chamber of Commerce (Department of Technology, Management and Budget director designee).
- David McGhee, officer with the Skillman Foundation (representing persons with relevant professional experience).
- Robert McMahan, president of Kettering University (representing persons with relevant professional experience.
- Beverly Walker-Griffea, president of Mott Community College (representing persons with relevant professional experience).
“I am very pleased to appoint such distinguished people to this important post,” Snyder said. “Each of these people cares deeply about the future of this great city and I’m certain they will work closely with Mayor Walling and city council members to move Flint forward and maintain a strong financial path.”
For more information about Public Act 436 of 2012, the Local Financial Stability and Choice Act, visit the Local Government Fiscal Health page on the Department of Treasury’s web site at www.michigan.gov/treasury.