City, state leaders share mixed reaction to bankruptcy plan - FOX 35 News Orlando

City, state leaders share mixed reaction to bankruptcy plan

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  • Detroit files plan to fix debt, leave bankruptcy

    Detroit files plan to fix debt, leave bankruptcy

    Friday, February 21 2014 12:49 PM EST2014-02-21 17:49:57 GMT
    Detroit's emergency financial manager filed a plan Friday that would bring the city out of bankruptcy, providing a detailed look at what the Motor City would look like when it finally sheds its financial burdens.
    Detroit's emergency financial manager filed a plan Friday that would bring the city out of bankruptcy, providing for the first time a detailed look at what the Motor City would look like when it finally sheds its financial burdens.
(WJBK) -

Mayor Mike Duggan and City Council President Brenda Jones:

"The Plan of Adjustment is a sober reality check for our city.
While some city services would receive much needed help, it is no surprise there will be difficult decisions ahead that affect residents, city workers and retirees.

The plan proposal provides us a framework for how we can move forward in delivering our most vital services with limited resources. The Mayor's office and City Council are committed to working together to achieve the goal of putting the city back on a solid financial foundation.
Across every department of city government, we are working together to identify new revenue streams and cost efficiencies that will allow us to provide well-managed services that all Detroiters expect and deserve.

Our city's future depends on our ability to grow its tax base, maximize efficiencies and manage costs. That is why we are united in our commitment to delivering a level of service that allows our city to retain and attract residents, grow businesses and encourage other forms of investment."

AFSCME Council 25 President Al Garrett

"Retires cannot survive these drastic cuts

The proposed plan of adjustment is a gut punch to Detroit city workers and retirees. The plan essentially eliminates health care benefits for retirees and drastically cuts earned pension benefits. Retires cannot survive these huge cuts to the pensions they earned. The plan is unfair and unacceptable.

Every step of the way, Governor Snyder has put his political agenda ahead of the folks that worked hard for the city. If Snyder wants to avoid devastating Detroit families, he should offer real solutions instead of unleashing bankruptcy attorneys on retirees.

AFSCME will fight for a more just result. We will continue our efforts in the courts and through negotiations."

The General Retirement System of The City of Detroit

"We believe releasing the Plan of Adjustment (POA) at this time is premature since we are still in mediation with many issues that need to be considered and discussed before any agreements can be reached.

"We are greatly disappointed that the POA contains debilitating and unnecessary cuts to accrued pension benefits and know the city can afford much better treatment to the people who have dedicated years of their lives in service of the city.

"We will continue to negotiate in good faith with all parties to resolve the issues before us and reach the best possible outcomes for our retirees, members and beneficiaries.  

"Fortunately the POA is a dynamic document that can be amended as mediation and negotiations move forward.  It is our hope that this premature action will not slow down the process for consensual resolution with all parties as increased litigation will be costly and delay resolution.

"It is disappointing that much of our attention and resources which have been dedicated to the mediation process may now be diverted to litigating the POA bankruptcy issues."
-Tina Bassett, spokesperson

Gov. Rick Snyder

"Detroit's comeback is underway. Emergency Manager Kevyn Orr has submitted a thoughtful, comprehensive blueprint directing the city back to solid financial ground, a crucial step toward a fully revitalized Detroit. There will be difficult decisions and challenges for all sides as this process moves forward.

"The state's focus is on protecting and minimizing the impact on retirees, especially those on fixed, limited incomes, restoring and improving essential services for all 700,000 Detroit residents and building a foundation for the city's long-term financial stability and economic growth.

"This plan of adjustment is a critical step forward as we look to resolve problems decades in the making.

"Let's use this plan as a call to action for a voluntary settlement as part of the mediation process to resolve the bankruptcy more quickly and soften the tough but necessary changes. We already have witnessed some strong collaboration around innovative ideas. We hope there can be more and that these efforts come to fruition.

"Detroit's long-term viability is not just essential for its residents -- but to all Michiganders."

Congressman John Conyers Jr. (D-Mich.)

"In the end, the courts will have the final word on any bankruptcy plan. However, I am disappointed by the Emergency Manager's bankruptcy proposal that - if adopted - would cut Detroit's general public employees retirees' pensions by 34% and police and firefighter retirees' pensions by 10%. This is not what Detroit's hard-working public servants deserve. Pensions are earned benefits that our neighbors, friends, and families in Detroit built up over decades of service to the Motor City. Retired general city workers receive a modest payment of around $18,000 a year in earned benefits while retired policemen and firefighters receive just $30,000. Further, pensions are explicitly protected from any cutbacks under Michigan's Constitution. I urge all parties to come together and continue negotiating to resolve this matter equitably."

Lon Johnson, Mich. Democratic Party Chair

"Republican Gov. Snyder's first budget broke a promise to seniors by creating a new retirement tax so corporations could get another tax cut, and now Snyder's latest plan for Detroit is an assault on Michigan's retired workers.

These retirees worked hard and played by the rules their entire lives, and Snyder should not break the promise of a secure retirement, guaranteed by the state's constitution. Michigan families need a governor who is on their side. It's time to elect Mark Schauer, who will uphold the constitution and fight to protect retirees."

Democratic gubernatorial candidate Mark Schauer

"By proposing deep pension cuts to retirees, Governor Snyder has demonstrated once again that he's not on the side of Michigan seniors. Our state constitution is crystal clear that pensions must be protected, which is why they never should've been included in Detroit's bankruptcy filing in the first place. Now seniors who are already struggling to pay the Snyder Retirement Tax will be sent to the back of the line with Wall Street creditors. Let's be clear, Rick Snyder has violated his constitutional oath, and has broken a sacred promise to Michigan's retirees."

Detroit Regional Chamber President and CEO Sandy K. Baruah

"Detroit's Plan of Adjustment provides a clear, workable and reasonable strategy to exit this historic bankruptcy. It is critical to understand that the reason the City is in bankruptcy is that the resources simply do not exist to pay the obligations that exist, including pensions, creditors and others. Any party to any bankruptcy proceeding that expects to emerge fully whole simply does not understand the painful reality of the situation. Finally, Mr. Orr's Plan of Adjustment focuses on needed investments in the City that are necessary for future success. At the end of the day, positioning Detroit for growth and success is the reason for these unprecedented actions."

Oakland County

"The City of Detroit had not given Oakland County any preliminary drafts of its plan of adjustment filed in U.S. Bankruptcy Court today; we just obtained a copy of our own. It is premature for Oakland County to comment on any section of the plan of adjustment until we have taken the time to evaluate its contents thoroughly."

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