Tenure as Emergency Manager[edit]
Michigan Governor Rick Snyder appointed Kevyn Orr as emergency manager to oversee Detroit financial operations on March 14, 2013 under Public Act 72. On January 24, 2013 Snyder had signed a revised version of a controversial emergency manager law that was rejected by voters during the November election.
[16] The new law, Public Act 436, took effect on March 28, 2013 and gave the Detroit emergency manager extraordinary control over all Detroit financial matters,
[17] and the ability to recommend to the governor and state treasurer that the government enter
Chapter 9 bankruptcy.
[18][19]
Orr began his expected 18-month term as emergency manager on March 25, 2013.
[20]
At Orr's recommendation and with the approval of Governor Snyder, the city of
Detroit filed for bankruptcy on July 18, 2013.
[2][21] His former law firm Jones Day was hired to handle Detroit's bankruptcy. The pick has been criticized as a conflict of interest (Jones Day represents several of Detroit's creditors like Bank of America) and the firms billing rates of up to $1,075 per hour and large travel expenses have been questioned.
[22] Yet some legal scholars have opined that no conflict existed between Orr and his former employer.
[23] Orr has said of his former employer, "if I didn’t have Jones Day, I might have had to hire six to eight additional firms."
[24]
On December 3, 2013, U.S. Bankruptcy Judge Steven Rhodes ruled that Detroit was legally entitled to pursue bankruptcy.
[25]
On November 7, 2014, U.S. Bankruptcy Judge Steven Rhodes approved Orr's plan for the city of Detroit.
[26]
On December 10, 2014, Governor Snyder announced that Detroit had emerged from bankruptcy, and that he had accepted Orr's resignation as emergency manager, returning control of Detroit to its elected government.
[27]
