This is a developing story.
The Detroit Free Press reported midday Thursday that Michigan Gov. Rick Snyder (R) is moving ahead with a financial review of the City of Detroit, the first step required for the state to appoint an emergency manager for the city -- a move both Detroit Mayor Dave Bing and the Detroit City Council have contested.
But sources in the governor's office, who wished to remain anonymous because they were not authorized to speak on the matter, told HuffPost that the Free Press report is "wrong."
[UPDATE: 2:00 p.m. --Geralyn Lasher, director of communications for Gov. Rick Snyder wrote on twitter that the Free Press report is "absolutely false."
UPDATE: 2:21 p.m. -- Sara Wurfel, a spokeswoman for Gov. Snyder, said in a phone call with HuffPost that the initial Free Press story "was definitely misleading and had key inaccuracies."
She said the governor has no set timeframe for starting a preliminary review of Detroit's finances or for appointing an emergency manager.
"We have been urging the mayor and City Council to come together and agree on a shared solution that could be viable," Wurfel said. "That has not happened yet, so timing is becoming tougher and tighter."
Wurfel stressed that a preliminary review would not necessarily lead to an emergency financial manager, but said the governor was unwilling to rule out the possibility of appointing one.
"It sounds like the situation there is severe, so it would be hard to imagine -- the thinking has been, why wouldn't the city want that kind of assistance?"]
A call to Mayor Bing's spokesman was not immediately returned. In a Tuesday interview with the Free Press, Bing said he would meet with Snyder this week, but that he would not request a review or an emergency manager.
A spokeswoman for City Council President Charles Pugh told HuffPost he was in a meeting and unavailable for comment and that she could neither confirm nor deny the report.
Earlier on Thursday, City Council met with representatives of Detroit's labor unions to discuss proposals for achieving savings to help close the city's budget gap and eliminate a $45 million cash shortfall.
Mayor Bing has called for 1,000 layoffs and other drastic measures -- including privatizing city lighting and buses -- to avoid the appointment of an emergency financial manager.
Some City Council members have proposed deeper cuts and larger layoffs, including cuts to the police and fire departments, as well as some revenue-raising measures. Others say they oppose layoffs and would prefer the city push for $220 million in revenue sharing owed by the state of Michigan.
At Thursday's meeting, Member JoAnn Watson spoke directly to the emergency financial manager threat, reminding those present about a drive to repeal Public Act 4, the law that allows the state to appoint an emergency manager for struggling communities and school districts.
"Some of us saw this coming," Watson said. "We have a lawsuit that's filed on our behalf. We have 28 plaintiffs around the state. Many people have worked to have petitions with thousands of signatures to repeal immediately this Public Act 4."
Watson said Gov. Snyder had pushed Bing and the Council to move to quickly because of that petition.
"That's why this timetable has been called for this week by the governor," she said. "The governor wants to take care of Detroit this week because he wants to act in front of signatures getting certified."
Michigan Forward, a nonprofit specializing in creating progressive public policy initiatives, has been sponsoring the repeal effort. The group has said it has more than the 161,305 signatures required to suspend the law. Representatives for the group could not immediately be reached for comment Thursday.
Critics of the law say it would disenfranchise Detroit's 713,000 residents, and has already disenfranchised 550,000 registered Michigan voters in other communities.
Emergency managers are in place in Benton Harbor, Pontiac, Ecorse and now Flint, as well as the Detroit Public Schools system.
This is a developing story. Check back here for updates.