Detroit council fails to approve contract tied to $10M payment

By Alexis Wiley
Fox 2 News Reporter

DETROIT (WJBK) -- "City council does not exist to be a rubber stamp body," said Council Member Ken Cockrel, Junior.

Council proved that Tuesday afternoon when they voted against the privatization of the Detroit Water and Sewage Department and the city's contract with the law firm Miller Canfield.

Most of the Detroiters at Tuesday night's community meeting said their council members made the right move.

"It was the best thing that they could've done," said one resident.

However, the mayor is anything but happy.  He released a statement saying, in part, "The state has made it very clear that if the City of Detroit did not meet all three milestones as outlined in our agreement, money from the city's escrow account would not be forthcoming.  The council's rejection of the Miller Canfield contact means the city will not receive the first $10 million scheduled for release today.  Today's vote is one more example of how city council has stalled our efforts to bring financial stability to the City of Detroit."

"I think he's wrong.  I mean, just read the document.  Just read it.  It doesn't say that we had to approve Miller Canfield in his document, the one that he negotiated with the state.  It said we had to vote on it and we did vote on it," said Council President Pro Tem Gary Brown.

"I wasn't surprised by the statement.  I do think it's disappointing and I do think that the real focus at this point needs to be on fixing the problem rather than complaining about it," Cockrel said.

"We also looked at the (conflicts) of interest that were numerous with that Miller Canfield contract.  So we would like to sit down with the mayor and come up with another law firm that we would be willing to accept," said Council President Charles Pugh.

Even Brown, the only council member who voted to approve the Miller Canfield contract, said the council filled its end of the bargain.

"We did everything that was in the memorandum of understanding," he remarked.  "I expect we'll be getting that $10 million shortly."

But regardless of whether you expect the cash or not, the reality is the state is the one holding the pursestrings and with no cash, we know what comes next.

What if Detroit goes bankrupt?  We asked Cockrel whether council is prepared for that scenario.

"It's not going to happen because I think you're going to see the city council and the mayor and his team come together, fix these issues and move forward.  Failure is not an option."

"I want to know why the state would allow us to go bankrupt over one law firm when we could simply choose another one," Pugh said.

"The bottom line is the mayor's probably got to do and his team have probably got to do a better job of polling council members, touching base with them ahead of time to find out exactly what their concerns are, address all of those concerns, and then make sure you count to five before you even bring it to council," said Cockrel.

Council members believe there is still time and room for negotiation to come up with an agreement that is okay with everyone.

I contacted the state Treasurer's Office.  They said they are always open to talk with council, but at the same time this is the agreement that's on the table.

City council actually did approved most of what the state asked for.

Watch the second video report above for more on this story from Fox 2's Amy Lange.