Watch CBS News

Bank Extends Detroit Deadline, Delays Cash Crunch

DETROIT (AP) - A bank is extending a deadline on a bond transaction that will let the city of Detroit get most of June's revenue sharing payment from the state.

The state treasurer's office said Tuesday that Aug. 15 is the new deadline to complete refinancing on a bond sale. June 27 was the original deadline.

The extension was necessary because a lawsuit opposing a financial stability agreement between the city and state held up completion of the refinancing. A judge dismissed the suit by Detroit Corporation Counsel Krystal Crittendon last month.

Detroit will get about $23.6 million of its $28.5 million revenue sharing payment. Revenue sharing backs the bonds.

City officials have said the bond transaction was necessary to help meet short-term obligations and to help meet employee payroll.

© Copyright 2012 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.

View CBS News In
CBS News App Open
Chrome Safari Continue
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.