Mediator's Tenure Extended, May Signal Extension of June 14th Deadline to Reach Deal with GLWA (UPDATED)

Update (6/8): At 8:37 a.m. this morning, the order entered on Friday extending Judge Cox's role as mediator was vacated by the Clerk of the Court. The order indicates that Friday's order was entered in error.   

Last Friday, June 5, 2015, the judge overseeing the remainder of Detroit's Chapter 9 bankruptcy entered  an order extending until January 1, 2016,  Judge Sean Cox's appointment as mediator of matters involving DWSD and the Great Lakes Water Authority.

Without an extension, Judge Cox's appointment would have expired on June 14, 2015, which is the deadline for DWSD and the Great Lakes Water Authority to finalize and execute the terms of a long-term lease. 

Under the contemplated lease agreements, the GLWA would operate and maintain DWSD's water and wastewater treatment facilities for 40 years in consideration of annual lease payments to the City of $50 million.

Under the terms of the Amended Plan of Adjustment submitted in the City's Chapter 9 bankruptcy, which created the Great Lakes Water Authority effective November 26, 2014, the new authority and the City of Detroit have 200 days to completion negotiations and execute the contemplated lease agreements. That deadline is June 14, 2015.

To date, these negotiations have occurred behind closed doors with Judge Cox serving as mediator, but subject to a court order prohibiting the participants from discussing any of the matters.  Macomb County Executive Mark Hackel has been very outspoken in his criticism of these confidential (secret) negotiations. Reports indicate that Macomb County has been shut out of the process. 

Comment: I have no inside information (which I couldn't share with you anyhow), but entry of last Friday's order, extending Judge Cox's tenure as mediator to the end of 2015, strongly suggests to me that the June 14, 2015 deadline to complete a deal on a long-term lease agreement is going to be extended. I don't know how you can finalize a deal if Macomb County is not part of the process. That makes no sense to me. If I were to guess, I would say the parties will ask (or have already asked) for a new deadline that goes to mid-October or early November. What do you think? 

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