LANSING, Mich., July 3 -- The Michigan Department of Treasury issued the following news release:
Governor Rick Snyder today appointed Brad Coulter as emergency manager for the city of Lincoln Park pursuant to Public Act 436 of 2012, the Local Financial Stability and Choice Act. Coulter is an independent contractor with O'Keefe & Associates, a turnaround consulting firm based in Metro-Detroit. Coulter will take a leave of absence from O'Keefe to assume emergency manager duties. Prior to joining O'Keefe, Coulter was a director at Amherst Partners, where he was a Certified Turnaround Professional consulting with middle market companies.
Coulter has more than 25 years of experience in management, corporate finance, and international business and has managed various restructurings including the development and implementation of turnaround plans for automotive suppliers, construction companies, non-profits, and various other entities. In addition to his financial background, Coulter has a broad range of business skills including strategic planning and government relations.
"Brad Coulter's extensive experience in finance and restructuring, including his understanding of government structure and municipal services, makes him a strong choice as emergency manager for Lincoln Park," Gov. Snyder said. "I know Brad will work collaboratively with city officials to address the financial emergency and to ensure Lincoln Park residents receive the critical services they expect and deserve."
Last fall, city officials requested a preliminary review of the city's finances. Following that review, and a subsequent review by a five member independent review team this past spring, Gov. Snyder determined that a financial emergency exists in Lincoln Park based on the following conditions:
* According to the city's 2013 fiscal year financial audit, the General Fund balance decreased from $2.0 million as of June 30, 2012, to a negative $89,803 as of June 30, 2013. This $2.1 million net change resulted from General Fund expenditures exceeding General Fund revenues by $2.3 million, which was slightly offset by a transfer into the General Fund of $166,666.
* A trend of over-spending from the General Fund. As recently as June 30, 2010, the ending balance in the General Fund was $4.5 million. Therefore, in just three fiscal years (2011 through 2013), city officials depleted a $4.5 million fund balance.
* City officials indicated that the General Fund deficit likely will increase by an additional $1 million during the current fiscal year, which ended June 30, 2014. City officials indicated this estimate to be a best-case scenario, assuming the city will receive financial concessions from its police unions. In the event such concessions are not realized, the deficit for the current fiscal year likely will be significantly greater.
Following Gov. Snyder's confirmation that a financial emergency exists in Lincoln Park, the city council selected a Consent Agreement from the four options available under Public Act 436; however, councilmembers voted 4-3 to reject the agreement after it was drafted last month. Because a Consent Agreement was not approved by the city within 30 days, State Treasurer Kevin Clinton determined the city should proceed under an emergency manager.
Brad Coulter and representatives from the Michigan Department of Treasury will hold a media conference call with reporters at 11:00 a.m. this morning. To participate in the conference call, credentialed members of the media should contact the Department of Treasury's Communications Division at 517-335-2167 for call-in information or e-mail Terry Stanton at email@example.com.
For more information regarding the city of Lincoln Park or the Local Financial Stability and Choice Act, visit the Local Government Fiscal Health (http://links.govdelivery.com/track?type=click&enid=ZWFzPTEmbWFpbGluZ2lkPTIwMTQwNzAzLjMzNjgwNTkxJm1lc3NhZ2VpZD1NREItUFJELUJVTC0yMDE0MDcwMy4zMzY4MDU5MSZkYXRhYmFzZWlkPTEwMDEmc2VyaWFsPTE2OTA5OTM3JmVtYWlsaWQ9Y29zc2FyYkBtaWNoaWdhbi5nb3YmdXNlcmlkPWNvc3NhcmJAbWljaGlnYW4uZ292JmZsPSZleHRyYT1NdWx0aXZhcmlhdGVJZD0mJiY=&&&100&&&http://www.michigan.gov/treasury/0,4679,7-121-1751_51556---,00.html) page on Treasury's website.