Topics: Labor Unions

Michigan treasurer resigns one day after Detroit bankruptcy deposition

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Beltway Confidential,Sean Higgins,Labor unions,Labor,Detroit,Analysis,Michigan,AFL-CIO,Detroit Bankruptcy

Michigan Treasurer Andrew Dillon submitted his resignation Friday, citing media attention regarding his divorce. His resignation came the day after he gave a deposition in a case filed by unions and retired workers against Detroit's bankruptcy declaration.

Dillion said his resignation was due to "issues related to my recent divorce and the unfortunate acrimony associated with it [becoming] a continued source of media attention and scrutiny."

He said, "My family deserves privacy and our residents deserve to know their State Treasurer is not distracted by such issues and events. For these personal and professional reasons, I have determined it is in the best interests of all that I resign."

Michigan AFL-CIO President Karla Swift issued a press release late Friday that said, "The timing of this announcement raises questions."

Dillion's departure comes the day after he was questioned behind closed doors for three hours by union lawyers regarding the state's decision to force Motor City into bankruptcy. City employee unions vehemently opposed the move, fearing it could result in severe cutbacks to their members' pensions.

In a statement Thursday regarding the deposition, Dillion said: "[T]he decision to seek bankruptcy protection was not an easy one but was determined to be the only remaining way to address Detroit's long-running financial crisis."

Republican Gov. Rick Snyder accepted his resignation with "regret but understanding" and praised his "dedication, expertise and leadership." Dillon's resignation becomes effective Nov. 1.

The AFL-CIO's Swift linked Dillon's resignation to an ongoing controversy over the New Energy to Reinvent and Diversify Fund, a nonprofit created by Snyder in 2011.

"Why would Dillon step down now, just as Governor Snyder’s secretive NERD Fund is beginning to receive serious scrutiny? We respect the Dillon family’s need for privacy, but wonder why it wasn’t an issue months ago," Swift said.

In August, Snyder confirmed that the fund had paid for Detroit Emergency Manager Kevin Orr's lodging in Michigan and commuting expenses from his home in Maryland. The monthly expenses are $4,200.

Orr was instrumental in the state's decision to push Detroit into bankruptcy. State Democrats have demanded to know who has donated to the NERD Fund. Snyder has justified the funding as needed to relieve taxpayers of the cost of Orr's stay in Michigan.

Michigan Live reported that Snyder was asked under oath about the fund during a deposition by union lawyers Wednesday regarding the Detroit bankruptcy decision. He said he did not know who the donors were.

It is almost certain that Dillon was asked similar questions by the union lawyers in his deposition Thursday.

Dillon is a former Democratic House speaker who lost a bid for his party's gubernatorial nomination in 2010. The following year, Snyder appointed him as treasurer.

It has been a tumultuous time for the state official. His ex-wife alleged he assaulted her during the summer. Police did not press charges, citing insufficient evidence.

He has reportedly acknowledged a drinking problem as well.

The Detroit Free Press reported Friday that "his gubernatorial campaign committee and other committees were wracked with accounting problems."

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