DETROIT — Gov. Rick Snyder has confirmed his determination that a financial emergency exists in the city of Detroit and assigned management of the emergency to the Local Emergency Financial Assistance Loan Board (ELB), pursuant to Public Act 72 of 1990. The ELB named Kevyn Orr as emergency financial manager, effective March 25, in a meeting held in Lansing Thursday afternoon.

“After thoroughly reviewing the information presented in Tuesday’s hearing, I remain convinced that a financial emergency exists in Detroit,” Snyder said. 

“With this action and by working together, we can rebuild the sound financial footing needed in Detroit. The extensive experience that Kevyn Orr has in working to turn around financially troubled organizations will serve the citizens of Detroit well.” 

The announcement of Orr’s new position as the city’s EMF occurred during a press conference Thursday where Snyder introduced Orr. Detroit Mayor Dave Bing was also present at the conference and said he would work and cooperate with Orr and the governor’s office to help fix Detroit’s finances.  

L-R: Mayor Bing, Governor Snyder and Kevyn Orr

“I am deeply saddened to see a historic city such as Detroit in severe financial distress, but I am confident we can and will put the city back on the path to success,” Orr said. He says he looks forward to working with Mayor Bing, City Council, citizens and all stakeholders, including city employees and businesses, and faith and philanthropic communities, to find effective solutions resulting in long-term prosperity for all.

“Governor Rick Snyder and Lansing Republicans have deliberately starved our communities of billions in revenue, while giving corporate special interests a huge tax break,” said Michigan Democratic Party Chair Lon Johnson. 

“Snyder and Lansing Republicans are forcing an unnecessary, hostile takeover as a solution to the problem that they themselves created. Meanwhile the democratic rights of Detroit’s citizens are being trampled to protect the interests of Snyder’s wealthy CEO friends and their lobbyists.” 

Orr has Michigan ties, earning both a bachelor’s degree and law degree from the University of Michigan, and has practiced in the areas of business restructuring, financial institution regulation and commercial litigation since 1984. In 2001 he joined Jones Day, a global legal institution with more than 2,400 lawyers covering five continents. He specializes in assisting organizations experiencing severe financial trouble, ensuring that they were brought to proper resolution, including representing Chrysler in all aspects of its 2009 bankruptcy and restructuring. He also is the firm’s partner for hiring and diversity and serves on its advisory committee.

Orr will assume the powers prescribed by Acts 72 and 436, and will be responsible for administering all actions necessary to carry out the written financial plan.

A new public act governing financial emergencies, Public Act 436 of 2012, will take effect March 28. All current EFMs, including Orr, will transition to emergency managers and continue to work under the guidelines of the new act.