7 Updates
Detroit bankruptcy raises red flags in other US cities
Photo Credit: Bill Pugliano, Getty Images

Detroit bankruptcy raises red flags in other US cities

Jul 23 2013, 4:36am CDT | by IANS

Washington, July 23 (IANS) Even as a federal judge set a hearing on a challenge to a bankruptcy filing by Detroit, America's famed automotive city, questions are being raised about the fate of several other debt-crushed major US cities.

Washington, July 23 — Even as a federal judge set a hearing on a challenge to a bankruptcy filing by Detroit, America's famed automotive city, questions are being raised about the fate of several...

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1 year ago

Detroit bankruptcy raises red flags in other US cities

Jul 23 2013, 4:36am CDT | by IANS

Washington, July 23 (IANS) Even as a federal judge set a hearing on a challenge to a bankruptcy filing by Detroit, America's famed automotive city, questions are being raised about the fate of several other debt-crushed major US cities.

Washington, July 23 — Even as a federal judge set a hearing on a challenge to a bankruptcy filing by Detroit, America's famed automotive city, questions are being raised about the fate of several other debt-crushed major US cities.

The federal judge overseeing Detroit's bankruptcy filing would hold a hearing Wednesday to determine whether a lawsuit by retired public employees can block it, according to the New York Times. The judge, Steven Rhodes of US Bankruptcy Court, agreed to the hearing requested by Detroit's emergency manager in response to a Michigan judge's ruling that the city's bankruptcy filing violated the state's Constitution because it could cut city workers' pensions.

The emergency manager, Kevyn D. Orr, had filed a motion asking that the city be protected from litigation as it proceeds with its historic bankruptcy filing, made last week.

At the heart of Detroit's problem is a growing unfunded debt on benefits owed to current and future retirees - some $3.5 billion,- which mirrors a circumstance being seen across the US, according to Orr, as cited by Detroit Free Press.

While many smaller cities have filed for bankruptcy, most notably California's Stockton and San Bernardino in 2012, no other city of Detroit's size appears to be on the cusp of imminent financial collapse, according to Fox News.

However, those bankruptcy filings together have resulted in speculation about whether more are on the horizon.

Other cities now on the radar include Cincinnati, Minneapolis, Portland, Oregon, and Santa Fe, New Mexico-following Moody's saying in April that they and 11 other municipalities were being reviewed for a possible credit downgrade, it said.

The situation is highlighted by a Pew Charitable Trusts Study of 61 major US cities that found they collectively had enough money to cover 74 percent of pension liabilities but only 6 percent of health care liabilities, Fox News said.

The total difference between what the cities owed to retired employees and what was covered equalled $217.2 billion, according to the report, "A Widening Gap in Cities," released in January.

(Arun Kumar can be contacted at arun.kumar@ians.in)

IANS

Source: IANS

 
Update
7

1 day ago

Detroit retirees back pension cuts by a landslide

Jul 22 2014 4:47am CDT | Source: Topix

Detroit Institute Of The Arts Holds News Conference Detailing Emergency Manager Kevyn Orr's Grand Bargain Plan
In a May 30, 2014 file photo, Detroit emergency manager Kevyn Orr speaks with reporters after addressing the Mackinac Policy Conference o ...
Source: Topix   Full article at: Topix
 

 
Update
6

1 day ago

Detroit retirees endorse pension cuts in bankruptcy; city praises ‘positive decision’

Jul 22 2014 2:56am CDT | Source: Canadian Business Online

Latest Detroit Bankruptcy Hearing Reveals New Plans For Creditors
DETROIT – A year after filing for bankruptcy, Detroit is building momentum to get out, especially after workers and retirees voted in favour of major pension changes just a few weeks before a judge holds a crucial trial that could end the largest public filing in U.S. history. Pension cuts were approved in a landslide, according to results filed shortly before midnight Monday. The tally from 60 days of voting gives the city a boost as Judge Steve ...
Source: Canadian Business Online   Full article at: Canadian Business Online
 

 
Update
5

3 days ago

Recent upgrades to Detroit quality of life to affect decisions at upcoming bankruptcy trial

Jul 20 2014 10:49am CDT | Source: Canadian Business Online

Detroit Institute Of The Arts Holds News Conference Detailing Emergency Manager Kevyn Orr's Grand Bargain Plan
DETROIT – Detroit neighbourhoods are being relit, its vacant homes are being sold off or torn down, its public transportation is cleaner and more often on schedule and the city has renegotiated some burdensome union contracts. In the little more than a year since state-appointed emergency manager Kevyn Orr made Detroit the largest U.S. city to seek bankruptcy protection, it has experienced a wide range of improvements that will f ...
Source: Canadian Business Online   Full article at: Canadian Business Online
 

 
Update
4

5 days ago

A Tale of Two Detroits: Divided by the Politics of Municipal Water

Jul 18 2014 8:24am CDT | Source: The Nonprofit Quarterly

Detroit Institute Of The Arts Holds News Conference Detailing Emergency Manager Kevyn Orr's Grand Bargain Plan
National Nurses United declares the Detroit Water turnoffs a looming health disaster, but Detroit emergency manager Kevyn Orr wants to “tamp do ...
Source: The Nonprofit Quarterly   Full article at: The Nonprofit Quarterly
 

 
Update
3

6 weeks ago

Detroit retirees with pensions at risk have plenty to read as they vote in city’s bankruptcy

Jun 8 2014 11:02am CDT | Source: Canadian Business Online

DETROIT – Retired Detroit bus driver Art Vardiman recently received a computer disk in the mail that contains hundreds of pages of documents. He also got a six-page blue ballot about cuts to his pension and a white one about health insurance. A 25-page notice explains why the changes are being proposed in Detroit’s historic bankruptcy. Vardiman, 63, keeps it all in a box near an easy chair in his living room. Confusing? He would rather steer a full coach through rush ...
Source: Canadian Business Online   Full article at: Canadian Business Online
 

 
Update
1

7 weeks ago

Michigan Legislature OKs $195 million for Detroit in plan to help end city’s bankruptcy

Jun 4 2014 12:41am CDT | Source: Canadian Business Online

Detroit Institute Of The Arts Holds News Conference Detailing Emergency Manager Kevyn Orr's Grand Bargain Plan
LANSING, Mich. – The Michigan Legislature’s $195 million lifeline to help prevent steep cuts in Detroit’s pensions and the sale of city-owned art is being hailed as a major step toward ending the largest public bankruptcy in U.S. history. The state funds will join a pool of money from 12 foundations and the Detroit Institute of Arts. A delighted Gov. Rick Snyder and allies are hoping Tuesday’s approval of the state money will persuade thousands of retirees and ...
Source: Canadian Business Online   Full article at: Canadian Business Online
 

 

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