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Bankruptcy and Beyond

Detroit’s emergency manager shares his insight on the future of Detroit

Page 48-49

Kevyn Orr has been the emergency manager of Detroit since he was appointed by Gov. Rick Snyder in March 2013. Along with the duty of overseeing Detroit’s fiscal crisis and financial operations, Orr has been influential in his handling of the city’s complex investigatory and bankruptcy matters. Prior to his position in Detroit, he was a partner of the international law firm Jones Day in Washington, D.C., where he represented Chrysler and the company’s 2009 bankruptcy. He earned a bachelor’s degree in political science as well as a law degree, both from the University of Michigan.

What is your favorite thing about Detroit?

Kevyn Orr: The resilience of its people and R.U.B BBQ Pub.

What needs to happen to position Detroit for sustainability in the post-bankruptcy era?

KO: For Detroit to continue with some of the reform efforts already started, but also to be prudent – as I suspect it will be with its new mayor and council – with its fiscal management.

What has surprised you the most about the fiscal crisis and bankruptcy process thus far?

KO: That is sort of a hard question because nothing has surprised me. People’s positions were hard-felt, and they have held on to them for a long time, but we are making progress. I guess one surprise I do have is a good one: that people of good faith, when they finally get down to brass tacks, can make the kind of movement and change that is necessary to move this city forward to reach a deal that benefits all the residents of Detroit.

In your view, what do you think are the biggest misconceptions, locally and nationally, about the Detroit bankruptcy?

KO: Locally, that this was somehow engineered, that the crisis isn’t as big as it has been said to be (it’s actually probably bigger when you factor in the trend lines). Nationally, the perception is that there is no good news or good opportunities coming out of Detroit. People have to recognize that this city, like a lot of cities, is not just a group of abandoned homes, it is a city that has a lot of grit and fortitude, focus and opportunity, and if they take some time to come here, we will be able to show that to them.

What do you think other municipalities facing similar challenges should take away from Detroit’s bankruptcy experience?

KO: I would caution any other municipality, or any other enterprise, not to think of Detroit as a template or a precedent for anything. All situations are different. Each case is different with its own circumstances, demography, balance sheet obligations, debt service, tax base, business community, Detroit’s emergency manager shares his insight on the future of Detroit challenges, et cetera. So, I would be very careful in thinking there are some broader implications or messages here. The only thing I would really take away is whatever issues you are dealing with, whatever crises or stressors are happening, deal with them as soon as possible. Delay is not a viable strategy and hope is not an answer.

What do you think about the prospect that your work on the nation’s largest municipal bankruptcy is likely setting the precedent and blueprint for cities around the nation facing bankruptcy or insolvency?

KO: I don’t think this restructuring is setting a blueprint. Each municipality or city is different, and I would be very careful about trying to extrapolate from Detroit’s process.

If we were to fast forward to the morning after your departure as Detroit’s emergency manager, and you pick up The Detroit News or Detroit Free Press, what headline would you like to see?

KO: “Detroit Continues Its Renaissance.”

Where do you see Detroit in 20 years?

KO: I see Detroit as a thriving community with a lot of reinvestment and interest. I see Detroit as a border city that has developed stronger trade relationships with our dear friends in Canada and internationally. And, as a city whose population is on the rise and continues to make great strides to being the great city that it always has been.

You earned your bachelor’s and law degrees from the University of Michigan. What is your favorite memory from your time at U-M?

KO: Beating Ohio State.

Let’s say you bump into Mayor Mike Duggan at a U-M alumni event 15 to 20 years after the city has emerged from bankruptcy. How does that conversation go?

KO: “Good morning, Senator…”