DETROIT — The U.S. government directed more than $100 million in grants Thursday to help bankrupt Detroit tear down vacant buildings and spur job growth, but the help falls far short of the wider bailout some city leaders had sought.
Gene Sperling, chief economic adviser to President Barack Obama, said the administration scrounged through the federal budget and found untapped money that "either had not flowed or had not gotten out or not directed to the top priorities for Detroit."
But considering the Motor City is at least $18 billion in debt, it will take a far larger infusion of cash or historic deals with bond holders, insurance companies and other creditors to correct the problem.
Sperling will join on Friday in Detroit three other top Obama aides — U.S. Attorney General Eric Holder, Transportation Secretary Anthony Foxx and HUD Secretary Shaun Donovan. The closed meeting also will include city and state leaders, and the emergency manager leading Detroit through the largest municipal bankruptcy in U.S. history.
The Obama administration repeatedly has signaled it won't offer a massive federal bailout like the one credited with helping rescue Chrysler and General Motors.
"There is not going to be a bailout," Democratic U.S. Sen. Carl Levin told The Associated Press on Wednesday. "We have enough problems with the federal deficit. We need to be creative and look at existing programs. There are still some funds there."
The funding announced by Sperling will include $65 million in Community Development Block Grants for blight eradication, $25 million in a public-private collaboration for commercial building demolition and nearly $11 million in funds to ensure working families can live in safe neighborhoods.
Holder will announce $3 million that, in part, will be used to hire new police officers. About $25 million also will be expedited to Detroit to hire about 140 firefighters and buy new gear.