DETROIT

Detroit Bonuses: Cash To Employees Criticized As Bankruptcy Looms

12/13/2012 03:03 pm ET | Updated Dec 14, 2012

Sure, Detroit officials might be struggling to balance the city's books in a bid to avoid an emergency financial manager. But that hasn't stopped those in charge of the city's payroll from getting into the holiday spirit.

Last Friday, the city issued special end-of-the-year bonus checks to nonunion city employees and managers as part of a perk offered under city ordinance, WWJ reports.

The bonuses, known as longevity payments, are given out each December as a reward for those who have served at least five years with the city. The checks ranged from $150 for those serving five years to $750 for those who have served over 26 years.

Mayor Bing had discussed eliminating longevity payments back in July. His spokesman Anthony Neely told WWJ the administration was investigating the matter.

Council President Pro Tem Gary Brown criticized the administration for handing out the bonuses after announcing it would be implementing unpaid furloughs for employees starting in January in an effort to resolve the city's financial crisis.

"It sends a horrible signal to all employees, the city and anybody that watches (Detroit government)," Brown told the Detroit News. "We need to get to the bottom of whether it was intentional or an accident of some sort. That has to be an oversight, and we have to get to the bottom of whose oversight it was."

While the threat of bankruptcy continues to confront the city of Detroit, the most recent crisis came in November. That's when Detroit City Council voted against a city contract with the law firm Miller Canfield's contract. This violated Bing's Milestone Agreement with Michigan Treasurer Andy Dillon, and endangered $10 million of funds held in escrow by the state. City Council later approved the contract, though it's still unclear whether the city will avoid the appointment an emergency financial manager. The recent disclosure of about $30 million of previously unbudgeted pension-related debt has further complicated the city's financial situation.

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