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Caller alleges Detroit misused UTGO bond funds to pay department salaries and benefits
Summary
During public comment, Malik Shelton asserted that UTGO bond proceeds approved by voters were improperly used to fund day‑to‑day department operations and employee compensation, a practice he called unlawful and potentially subject to federal and state enforcement.
A public commenter at the Budget, Finance and Audit standing committee meeting accused the city of using voter‑approved UTGO (Unlimited Tax General Obligation) bond proceeds to finance a city department’s day‑to‑day operations, including salaries and benefits.
The allegation was made during public comment; the committee lacked a quorum and took no formal action.
“When those, proposal in UTGO bonds were placed on the ballot in 02/2020 … The funds were supposed to be used for the purpose of constructing, demolishing, and reconstructing, and equipping public buildings, not for financing an entire city department, i.e., the Detroit construction and demolition department, and paying city workers' salaries, their vacation time, and their health benefits,” Malik Shelton, a public commenter, said. Shelton called the practice “unlawful” and warned of possible IRS and Securities and Exchange Commission implications, and cited the Michigan Finance Act in arguing the bonds were misused.
Shelton also said the bond authorizing resolution did not mention using bond proceeds for establishing and operating a full city department and named the law firm Miller Canfield in connection with the bond issuance.
The committee recorded public comment only and did not provide staff response or take action. The committee chair noted the meeting lacked a quorum and that agenda items will be carried to the next scheduled meeting.
Shelton’s assertions are allegations made during public comment and were not corroborated by staff testimony during the session. The committee made no determinations on the matter at this meeting.
