DETROIT -- Workers and retirees approved pension cuts in Detroit's bankruptcy, the city announced Monday, a crucial step to emerging from the largest municipal insolvency in U.S. history.
The city reported results from two months of balloting, which ended July 11. Judge Steven Rhodes still must hold a trial in August to determine whether Detroit's overall bankruptcy plan is fair and feasible to all creditors.
"It's clearly a victory for the city," said Anthony Sabino, a bankruptcy expert who teaches business law at St. John's University in New York. "It will pave the way for a confirmation hearing. Detroit will be able to move forward, not with absolute financial certainty but far more than Detroit has enjoyed in decades."
Ballot approval of the pension changes triggers an $816 million bailout from Michigan, foundations and the Detroit Institute of Arts. The money would prevent the sale of city-owned art and avoid deeper pension cuts. The judge, however, still must agree.
A Section on 07/22/2014