When Detroit entered bankruptcy less than two years ago, some experts predicted that the city would be locked up in litigation for years to come. The decision to put the city into the largest municipal bankruptcy in U.S. history was not without resistance and challenges. Gov. Rick Snyder’s decision to install Jones Day lawyer Kevyn Orr as the emergency manager in Detroit to begin the bankruptcy process was met with a lot of opposition from groups that have long been skeptical about Lansing’s involvement in Detroit’s affairs. Added to this conundrum was the fact that a Republican governor was making a significant change in the governing affairs of the largest Democratic constituency in the state.
It did not bode well for labor and many other groups, including retirees of the City of Detroit. What began as an unpredictable journey before bankruptcy judge Steven Rhodes ended on a mixed note. The DIA was saved. Billions of dollars were shaved off Detroit’s debt leaving $1.5 billion to pay for city services. Thanks to a bipartisan “Grand Bargain” engineered by the bankruptcy mediator, federal chief judge Gerald Rosen, retirees had their pensions slashed a bit, but still received a significant percentage of their pensions.
After a 17-month battle with creditors, the city came out of bankruptcy. Detroit is back in the hands of its democratically elected leaders Mayor Mike Duggan, Council President Brenda Jones and the rest of the council members.
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