Financial advisory board member warns Detroit could soon have cash crisis

DETROIT (WXYZ) - A member of Detroit's Financial Advisory Board is warning the city could run out of cash in a matter of months.

"There's a lot good work going on, but it's so slow, and the city is hemorrhaging cash so fast that at least at the present pace, I can't see things coming together," said Ken Whipple, Vice Chair of the FAB. "I think the city will run out of money before it gets the chance to have these improvements that it needs."

The city's operating deficit is approximately $200-million, and Whipple suggests getting outside help to reverse it. He's suggesting Detroit hire a financial restructuring advisor and an operating advisor.

 

"I agree with the Financial Advisory Board that the pace of change in the City of Detroit is not moving as quickly as I would like, and certainly not as fast as the people of Detroit would like," said Mayor Bing in a statement. "However, I believe that with the execution of my Financial Stability Agreement and the support of Lansing, we will  have the necessary cash flow to meet the City's cash requirements."

A cash shortfall for the city could mean cuts in services, unpaid payroll, and layoffs.

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