Detroit bankruptcy judge opens court to critics

The Associated PressJuly 15, 2014 

— A judge overseeing Detroit's bankruptcy gave the microphone Tuesday to residents and retirees who oppose the city's proposal to cut pensions and other benefits as part of a plan to get solvent again.

Hundreds of people have filed objections to Detroit's bankruptcy exit strategy. About 80 were given five minutes each to speak to Judge Steven Rhodes during morning and afternoon sessions, although many didn't show.

"I never thought I would be struggling to get health care," retired bus driver Jesse Florence Sr. told the judge. "This is devastating. We have other obligations."

Another critic, Jo Ann Cooper, expressed doubts about the bankruptcy process.

"I do not believe the city of Detroit is broke," she told the judge. "I have no proof of it. There have been a lot of lies over the years."

Detroit filed for bankruptcy a year ago, citing debt of about $18 billion. A so-called "grand bargain" involving the state, a group of private foundations and the Detroit Institute of Arts have pledged more than $800 million to ease the pension cuts while protecting city-owned art from being sold.

Rhodes will hold a trial on Detroit's plan to get out of bankruptcy, starting Aug. 14. He must find that the exit plan is fair and feasible, among other things, in order for the city to shed billions of dollars in debt.

"Your input is extremely important in this process," Rhodes told the crowd.

Last Friday was the deadline for creditors to vote, including roughly 30,000 retirees and current and former workers. General retirees would see a 4.5 percent pension cut while retired police officers and firefighters would lose a portion of their annual cost-of-living adjustment. Detroit's two pension funds urged a "yes" vote.

The results will be announced Monday.

"We are hoping at the end of this process to provide better services in a revitalized city," Detroit bankruptcy attorney Heather Lennox told Rhodes.

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