Tag Archives: pension fund

Detroit files for bankruptcy

When I heard about this story on NPR I wasn’t surprised.  Detroit has struggled since the closing of car factories.  Several years ago when I visited Detroit, in my opinion Detroit seemed like an empty city.  The factories were big lots of land deserted.

Yesterday (July 18th) Detroit filed for bankruptcy under Chapter 9.  Detroit is seeking to negotiate is $18.5 million debt.  Governor Snyder stated,

The fiscal realities confronting Detroit have been ignored for too long. I’m making this tough decision so the people of Detroit will have the basic services they deserve and so we can start to put Detroit on a solid financial footing that will allow it to grow and prosper in the future.

This is a difficult step, but the only viable option to address a problem that has been six decades in the making.

Consequently, two pension funds have filed a complaint against emergency manager Kevyn Orr (Gen. Ret. Sys. of the City of Detroit v. Orr., No. 13-768-CZ, Circuit Court Ingham County, Michigan) and Governor Snyder seeking to block the bankruptcy from proceeding.

The funds allege that a bankruptcy proceeding would interfere with the constitutional protection of public retiree rights.

via Detroit files for bankruptcy, the biggest US city ever to do so – ABA Journal.

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