Topics: Barack Obama

Detroit looks to White House to turn the lights back on

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Politics,White House,Transportation,Barack Obama,Detroit,Eric Holder,PennAve,Susan Crabtree,Detroit Bankruptcy

Four top Obama administration officials will travel to Detroit on Friday and one of the top items on the agenda is to see if the federal government can help turn the lights back on in the bankrupt city – literally.

Attorney General Eric Holder, Transportation Secretary Anthony Foxx, Housing and Urban Development Secretary Shaun Donovan, and White House economic adviser Gene Sperling will meet privately with state and local leaders.

A source familiar with the meeting said leaders of the Motor City have sought federal government funds for a host of programs, including one to fix its street lights, 40 percent of which are not functioning because of theft and disrepair.

The source said that restoring street lights has been at the top of city leaders' agenda as they struggle to maintain public safety amid their financial restructuring.

Early Thursday the White House announced $300 million in federal assistance from new and existing programs to help improve public safety, transportation and to eradicate blight caused by foreclosed homes.

“The Obama administration is dedicated to ensuring that the federal government remains an active partner in bringing jobs back into the city, and turning the people of Detroit's vision of the future into a reality,” the White House said in a statement.

The White House said the federal government would try to help light up Detroit's darkened streets as part of a “technical partnership” between the Department of Energy, Detroit's Public Lighting Authority and DTE Energy, a local utility. It did not put a dollar-figure on the partnership.

The federal government’s plans include a direct cash infusion of $65 million in block grant funds for "blight eradication and housing rehabilitation," $25 million for commercial building demolition — which includes $10 million in private funds — $10 million for affordable housing, and $3 million for hiring new police officers, the White House said.

The meeting between Obama administration, state and city officials and community leaders is being held behind closed doors. Officials will speak to the press following their discussions.

Detroit in July filed for Chapter 9 bankruptcy, the largest municipality to do so in U.S. history. The high-profile visit will refocus attention on the Obama administration’s handling of Detroit’s fiscal crisis.

Treasury Secretary Jack Lew said soon after Detroit went bust that there would be no “bailout” for the ailing city. But White House officials have met with city and state officials to pinpoint ways the federal government could help Detroit out of its budget mess.

The situation provides a challenge for President Obama, who has faced pressure from labor groups demanding that Washington intervene. But the White House has been measured in its public response, following the massive multi-billion dollar bailout for the city’s automakers.

After the federal government poured $85 billion into propping up General Motors and Chrysler in 2009, the Obama administration and key Democrats have been quick to say the assistance will be on a small scale and that the federal government would not be on the hook for Detroit’s restructuring.

"There is not going to be a bailout," Sen. Carl Levin, D-Mich., told the Associated Press on Wednesday. "We have enough problems with the federal deficit. We need to be creative and look at existing programs. There are still some funds there."

Levin, along with fellow Michigan Democratic Sen. Debbie Stabenow, will join the meeting by video conference. The threat of a government shutdown kept them in Washington Friday.

“Members of the Michigan Congressional delegation have worked with the Obama administration to identify existing resources that could assist Detroit's rebirth, and as today's announcement shows, those efforts have yielded positive early results,” Levin said in a statement.

Although his top aides have worked to identify available federal money for Detroit, Obama has yet to visit the city since it declared bankruptcy.

Last week, the president decided to travel to a Ford manufacturing plant in Missouri to tout the auto industry’s resurgence instead of visiting the many Detroit-area auto plants with similar success stories.

Detroit is already using federal funds. In late August, the city used $52 million from Washington to begin the process of demolishing thousands of blighted homes.

The money came from a Treasury Department program designed to help communities hardest hit by the nation's housing and foreclosure crisis. Detroit split $100 million in federal funds with Pontiac, Flint, Grand Rapids and Saginaw, which also received demolition money.

"We're not talking about a huge amount of money here," said a source familiar with the talks. "[The Obama administration] is just trying to work with local and city officials to get a quick win on the table without a lot a major investment."

The street-light blackout is a particularly vexing problem, which has plagued the city for three years and has only gotten worse after the bankruptcy.

In the past, fixed and repaired lights became targets for scrappers who would steal the copper wiring.

The city plans to start use new street-light technology that doesn't depend on copper wiring, but they need hundreds of millions of dollars to purchase it, according to Odis Jones, the director of Detroit's Public Lighting Authority.

Sending four top administration officials could potentially set the stage for an Obama visit in the future.

“It would be wise to use his subordinates to essentially feel out the situation and the lay the groundwork for a possible later visit,” said Donald Anderson, a University of Michigan political science professor.

The city is also in the midst of a hard-fought mayoral campaign between two Democrats: Mike Duggan, a former hospital executive who is white, and Wayne County Sheriff Benny Napolean, who is black. Democratic leaders including Obama have stepped gingerly around the contentious race.

A new poll out this week shows Duggan leading 49 percent to 25 percent.

This story was published on Sept. 26 at 7:29 p.m. and has been updated.

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