Detroit City Council has voiced concerns over the attorney fees the City is paying in its bankruptcy. The bankruptcy attorney fees recently increased and Detroit is responsible for paying the bill no matter the results.
Detroit Councilmen Saunteel Jenkins and Ken Cockrel took a tempered approach by offering that if the bankruptcy produces certain results, then the attorney fees will be well worth it. The Detroit Councilmen seem to be more concerned with actually be held in the dark about the bankruptcy and expectations on the bankruptcy outcome. Time will tell if Detroit can meet its goals in the bankruptcy and restructure its debts.
DETROIT, MI — City Council members complained Tuesday that they have little information on what services and results are being produced by consulting firms that have cost the city more than $62 million amid bankruptcy proceedings.
“If this money being spent was going to cut down our $14 billion or $18 billion — depending on who you believe — debt down tremendously, then it would be a bargain,” said Council President Saunteel Jenkins on Tuesday. “The reality is, we sit here today without a clue about what their results are.”
The Detroit Free Press over the weekend revealed results of a documents probe that showed a $45 million rise in Detroit’s consulting and legal fees over the last six months.
Emergency Manager Kevyn Orr took over the city in March with the authority to sign contracts without council approval. He took the city into bankruptcy proceedings in July to slash the city’s massive long-term obligations.
Orr’s office argues that the expertise the costly consulting contracts are providing the city is necessary to conduct Detroit’s historic restructuring.
Councilman Ken Cockrel, Jr. said the city’s legislative body needs data to prove the impact the contractors are having.
“They may be worth it,” he said. “We don’t know,” Cockrel said.
Restructuring consultant Conway MacKenzie was initially awarded a $4.2 million contract that has grown to $19.3 million, according to the Free Press report.
“Emergency manager or not, private contractors or not, these are public dollars being spent,” said Jenkins. “These are taxpayer dollars, and to spend $19 million on an entity that’s been here for six months and nobody can say for sure what the value is that we’re getting for those dollars is ridiculous. It’s a crime.
“The question is: What has Conway McKenzie done for the city? … We can’t even make the argument that they’re not worth it, but we can’t make the argument that they are worth it, because nobody’s reporting what they’ve done.”
MLive: http://www.mlive.com/news/detroit/index.ssf/2013/10/detroit_council_frustrated_by.html
