(09/16/11) - The State Treasury said the City of Flint has probable financial stress.
The ruling comes just weeks after a preliminary review of the city's books was conducted.
A senior treasury adviser called Flint Mayor Dayne Walling Friday evening. Walling said he expected this outcome all along.
"There's only two options in the prelim review: Probable financial stress or no stress. We all know the city has a number of long standing financial challenges," he said.
Walling said challenges include multi-million dollar deficits, cash flow and outstanding labor contracts. Flint was taken over by the state once before in 2002.
Mayor Walling believes his administration and the treasury will work together to solve the city's financial crisis. "The state treasury recognizes significant progress has been made to stabilize the city's finances, but there are a number of outstanding challenges and obstacles and those have to be addressed," he said.
The state will appoint a full review board, but whether it consists of government or business leaders remains unknown. Once the review is done, there's two possible rulings: A consent agreement giving local leaders more power or a takeover. No time limit has been given to when that will happen.
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