The Detroit City Council on Monday voted unanimously against a $350-million loan for bankruptcy financing secured by Emergency Manager Kevyn Orr, The Detroit News reports.
Orr announced earlier this month the city secured a loan with Barclays to pay off a pension related-debt and finance improvement of government services while Detroit is in bankruptcy.
The state’s emergency manager law allows the City Council to accept or reject the deal. The six-member council now has seven days to propose an alternative to the state’s local emergency loan board that would reach the same financial result as Orr’s agreement or better.
It didn’t appear Monday the council would offer an alternative. Instead, it will let bankruptcy court proceedings play out.
“The reality is, it seems to me, that one could make the argument that an alternative plan is not to act on this at all, but rather to fight on this issue in bankruptcy court,” Councilman Kenneth Cockrel Jr. said, questioning the timing of Orr’s deal.
