State paying $400-an-hour for private attorneys

Gov. Rick Snyder, left, and Detroit Emergency Manager Kevyn Orr.

Gov. Rick Snyder, left, and Detroit Emergency Manager Kevyn Orr.

With Gov. Rick Snyder’s administration playing a major role in Detroit’s bankruptcy, the Attorney General’s office has beefed up its representation of the governor and other state officials with some outside counsel.

And they aren’t cheap.

As first reported by The Detroit News, the Attorney General’s office has a contract with attorneys at the law firm Dickinson Wright to serve as special assistant attorneys general in case.

Steven G. Howell, a bankruptcy attorney in Dickinson Wright’s Detroit office, has been in court lately alongside Matthew Schneider, chief legal counsel for Attorney General Bill Schuette.

Behind the scenes, attorney Peter Ellsworth in Dickinson Wright’s Lansing office also has been providing the governor, state Treasurer Andy Dillon and Snyder aide Richard Baird representation.

Howell, Ellsworth and two senior partners are billing the state Treasury Department $400 an hour for their services, while junior partners are billing $300-an-hour and associates are collecting $235 for each hour of work on the bankruptcy, according to a contract the Attorney General’s office released to The News this week.

The contract contains a $225,000 “budget ceiling” that the private attorneys are likely nearing after a busy September and October for the state’s defense of the bankruptcy filing.

As of Aug. 31, Dickinson Wright Contract had already billed the state $106,739.56, though the AG’s office was able to reduce the bill by $800 “following the standard office invoice review of charges,” said Joy Yearout, spokeswoman for the Attorney General’s office.

But just in case the bankruptcy case drags out in protracted litigation, the Treasury Department has a $3 million budget for legal services this fiscal year.

“Due to the nature of this contract and difficulty in estimating actual costs and the demand for services, the contract budget ceiling may be increased, if approved in writing by the department. An increase in the budget ceiling shall not affect the established hourly rate during the term of this contract or any amendment,” according to the contract.

Chad Livengood
Chad Livengood is a state government and politics reporter for The Detroit News. He can be reached at clivengood@detroitnews.com or (517) 371-3660.