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Detroit files for Bankruptcy

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The city of Detroit filed the largest municipal bankruptcy case in U.S. history Thursday afternoon, culminating a decades-long slide that transformed the nation's iconic industrial town into a model of urban decline crippled by population loss, a dwindling tax base and financial problems.

The 16-page petition was filed in U.S. Bankruptcy Court in Detroit.

Gov. Rick Snyder's office was making plans this afternoon to hold a 10 a.m. Friday morning news conference at the Maccabees Building, 5057 Woodward in Midtown, according to his office. It's the same location where the governor declared a financial emergency for Detroit on March 1.

Snyder authorized Emergency Manager Kevyn Orr to file bankruptcy under a law the Legislature passed in December that replaced the previous emergency manager law voted repealed last November.

The bankruptcy filing came minutes before Ingham County Circuit Judge Rosemarie Aquilina was set to hold an emergency hearing Thursday afternoon on a request for a temporary restraining order blocking Snyder from authorizing a bankruptcy filing.

"It was my intention to grant you your request completely," Aquilina told lawyers for Detroit's pension boards.

The judge did grant temporary restraining orders against Snyder and Orr taking further action in the bankruptcy proceedings.

Ronald King, an attorney representing the police/fire and general retirement pension systems, said he may file a motion Friday in the case seeking to require Orr, an officer of the state, to withdraw the bankruptcy filing.

After the hearing, King expressed frustration with the governor's office after filing a motion for a temporary restraining order at 3:37 p.m. and giving Snyder's attorney extra time to get to the downtown Lansing courthouse.

The bankruptcy case was filed at 4:06 p.m. and Aquilina convened the emergency hearing at 4:11 p.m.

"This was a race to the courthouse this afternoon and yet another example of (the Snyder administration) completely usurping the will of the people, ignoring the referendum in the fall and then flat-out racing to file bankruptcy protection so you can get out from the protection of (pensions)," King told reporters.

Aquilina was preparing to hear arguments Monday from retirees seeking to stop the bankruptcy filing, which produced an automatic stay of all pending litigation and capped a month of intense talks between Orr's team and creditors, which largely have failed to restructure as much as $20 billion in debt and long-term liabilities.

Orr's spokesman, Bill Nowling, could not be reached for comment. And state officials contacted by The News on Thursday declined to discuss the matter, though Snyder spokesman Jeff Holyfield confirmed the governor authorized the filing.



From The Detroit News: http://www.detroitnews.com/article/20130718/METRO01/307180103#ixzz2ZRCqBFIe

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