Detroit bankruptcy

Law
1:15 pm
Fri August 29, 2014

Detroit bankruptcy judge will hear more arguments about water shutoffs

Credit Ross Kuhn / via Facebook

Some Detroit residents and activists are trying to put water shutoffs on hold—again.

The Detroit water department resumed its residential water shut-off program for delinquent customers this week. It’s trying to collect more than $80 million in back payments.

The city had put the controversial program on hold for about a month, while holding water assistance fairs and giving those who struggle to pay their bills time to get on payment plans.

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Stateside
5:04 pm
Thu August 28, 2014

Detroit is offered a $4 billion loan in exchange for DIA art

Credit Flickr

A New York lender called Art Capital Group is offering a $4 billion loan to the city of Detroit if it puts up its art collection as collateral.

Detroit News business columnist Daniel Howes said the city would be wise to pass on this offer.

The proposal is being backed by holdout bond insurers Syncora, and the Financial Guaranty Insurance Company.

Howes said the proposal would put DIA art one step closer to being sold, pensioners would receive a lot less money, and the loan would be spread around to other creditors.

Howes said city officials said they were not interested in discussing the deal, and that they say they will stand behind the "Grand Bargain" because it is money in hand and the deal will help avoid legal issues.

Howes also said the offer is just now coming up to stall the bankruptcy trial.

Read Howes column in the Detroit News here.

*Listen to the full interview with Daniel Howes above. 

Stateside
4:44 pm
Wed August 20, 2014

Will Detroit be able to pay its bills after bankruptcy?

Credit JSFauxtaugraphy/Flickr

Bridge Magazine writer Mike Wilkinson recently wrote a piece that explored the dollars-and-cents of Detroit, post-bankruptcy and beyond.

It's titled “Can Detroit Pay Its Bills Post-Bankruptcy?”

Wilkinson said though Detroit has been cash strapped for a while in terms of debt, it does generate a lot of money. It has the highest income tax and property tax in the state. It is the only city in the state allowed to levy a utility tax. And it has an averaged $179 million in casino taxes.

“It’s raising more money than Cincinnati, Chicago, Kansas City, Orlando, in terms of per person,” Wilkinson said.

Assuming that Kevyn Orr’s Plan of Adjustment is approved by Judge Rhodes, will this revenue be enough to pay the bills? Wilkinson wrote in his piece, “Revenues alone do not a budget make.”

And Eric Scorsone, an MSU professor and expert on city finances, said in order to answer that question, we must ask what will Detroit spend the money on?

“The truth is it would be very easy to overspend again as Detroit has in most of its history, and that’s going to be the real challenge for the political leadership of Detroit.” Scorsone said.

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Politics & Government
6:00 am
Tue July 29, 2014

Detroit has put water shutoffs on "pause"--but not across the board

The Detroit water department recently announced a temporary break in its campaign to cut service to delinquent customers—but some people are still being shut off.

Last week, water officials agreed to a 15-day “pause” in water shutoffs, which have ramped up since March as the department tries to collect millions in delinquent payments.

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Law
6:47 pm
Tue July 22, 2014

Detroit retirees said "yes" to the city's bankruptcy restructuring plan. What's next?

Detroit retirees voted overwhelmingly to approve emergency manager Kevyn Orr's plan of adjustment.

That plan includes the unprecedented "grand bargain"--a mixture of public and private funds that will minimize cuts to city pensions, while protecting the Detroit Institute of Arts' assets from other city creditors.

But retirees aren't the only group of creditors who voted on the plan. Other groups did as well--and not all voted "yes."

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Law
12:37 am
Tue July 22, 2014

Detroit retirees say yes to the "grand bargain" in big victory for Kevyn Orr, DIA

The grand bargain would protect the Detroit Institute of Arts' collection from being sold to pay off the city's debts.
Credit Detroit Institute of Arts

The proposed "grand bargain" that would soften the blow to Detroit pensioners while preserving the city's art collection has cleared a major hurdle.

That's because city retirees have voted for the plan by an overwhelming margin.

As city creditors, pensioners got to cast ballots for or against emergency manager Kevyn Orr's bankruptcy restructuring. The grand bargain is an integral part of that plan of adjustment.

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Law
6:00 am
Mon July 21, 2014

We should learn whether Detroit retirees approved the "grand bargain" today

We should know how Detroit retirees voted on the proposed “grand bargain” later today.

City pensioners had until July 11th to vote on the city’s bankruptcy restructuring plan, formally known as the “plan of adjustment.”

The grand bargain is just one part of that plan.

It would use more than $800 million in combined state and private foundation dollars to backstop city pension funds, minimizing retiree losses.

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Politics & Government
11:41 am
Sat July 19, 2014

Nurses rally against water shutoffs, declare "public health emergency" in Detroit

Actor Mark Ruffalo, center, joined the protest against water shutoffs in downtown Detroit.
Credit Kenny Karpov

Hundreds of protesters gathered near city hall in downtown Detroit Friday, to demand the city stop ongoing water shutoffs.

More than 17,000 Detroit households have had their water shut off for non-payment since March, though many have since had service restored.

City officials say the shutoffs are a necessary measure, because too many people simply don’t pay their bills--starving the water system of up to $100 million in revenues.

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Stateside
1:07 pm
Thu July 17, 2014

Detroit's bankruptcy, one year later

Credit JSFauxtaugraphy/Flickr

Tomorrow afternoon at 4:06 is the one-year anniversary of the largest municipal bankruptcy in American history.

Detroit News Business Columnist Daniel Howes has been talking with top business leaders in Detroit for a "temperature check" on how this first year has gone.

He said that the kind of leadership and coalescence that happened in the past year was something he’s never seen before in this community.

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Politics & Government
11:20 pm
Wed July 16, 2014

DIA secures $26.8 million in corporate pledges, reaches 80% of "grand bargain" goal

Credit Detroit Institute of Arts

The Detroit Institute of Arts is closer to fully funding its portion of the “grand bargain.”

The museum announced $26.8 million in additional corporate pledges today on Wednesday.

8 companies announced contributions. The Penske Corporation led the way with a $10 million donation, while both Quicken Loans/Rock Enterprises and DTE Energy chipped in $5 million.

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Politics & Government
10:06 am
Sat July 12, 2014

The week in review: Art, oil, schools and money

Credit Julie Falk / Flickr

Week in Review interview for 7/12/14

This Week in Review, while Emily Fox sits in for Rina Miller, she and Jack Lessenberry discuss how selling works from the Detroit Institute of Arts wouldn't make financial sense in helping with the city's bankruptcy, the threat of an oil spill under the Straits of Mackinac, and money problems with Flint Community Schools.

Law
6:38 pm
Fri July 11, 2014

Detroit "grand bargain" ballots were due today

Credit Sam Beebe

Today was the deadline for Detroit retirees to vote on the city’s bankruptcy restructuring plan, known formally as a “plan of adjustment.”

The California firm tallying the votes had to receive them by today.

All creditors get to vote on the plan of adjustment. But pensioners’ votes are particularly key—especially when it comes to the future of the “grand bargain.”

That’s the deal to use more than $800 million in public and foundation money to minimize pension cuts, and protect the Detroit Institute of Arts’ collection from being sold to pay off creditors.

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Stateside
6:25 pm
Thu July 10, 2014

DIA collection valued up to $4.6 billion as voting approaches home stretch

Credit Flickr

A new appraisal of the Detroit Institute of Arts' collection has found the works could be worth between $2.7 billion and $4.6 billion dollars. That's a big difference from the $867 million value that Christie's put on the collection last fall.

Detroit News Business columnist Daniel Howes joined us to tell us what he saw in the evaluations.

Howes clarified that the $867 million valuation by Christie’s only looked at 5% of the DIA’s collection, whereas the new appraisal evaluated its entire collection. He also pointed out the caveat attached to the big $4.6 billion number: “If you try to sell big chunks of the collection at the same time, you likely press the prices dramatically.”

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Politics & Government
5:57 pm
Thu July 10, 2014

Detroit is shutting off water to delinquent customers. But is everyone getting the same treatment?

In Detroit, controversy is raging over one of the few things the bankrupt city has in abundance: water.

So far this year, Detroit has shut off for 17,000 customers as it tries to collect millions in overdue bills.

But many residents are upset with how the city is going about it—and question whether some are getting special treatment.

“Here we are, giving out water…and we still owe on the water bill”

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Detroit bankruptcy
5:15 pm
Wed July 9, 2014

Report: DIA collection worth as much as $4.6 billion

The Wedding Dance, by Peter Bruegel the Elder, is one of the most valuable works at the DIA.
Credit Detroit Institute of Arts

A New York art investment firm says, on paper, works at the Detroit Institute of Arts could be worth as much as $4.6 billion. But the report by ArtVest Partners says the artwork could go for a lot less, if it's liquidated as part of the city's bankruptcy.

An earlier appraisal of the DIA's collections by Christie's auction house looked only at works bought with city money, and said selling those would bring in no more than $866 million.

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Politics & Government
7:00 am
Wed July 9, 2014

Detroit officials get pay raises

Credit State of Michigan / Michigan.gov

Detroit emergency manager Kevyn Orr has given the city’s leaders a pay raise.

Orr signed an order hiking city appointees and elected officials’ pay by 5% on June 30th. It went into effect July 1.

Detroit Mayor Mike Duggan seemed genuinely surprised to hear that news on Tuesday.

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Politics & Government
1:35 pm
Sun July 6, 2014

Deadline approaches for bankruptcy plan vote

Credit JSFauxtaugraphy/Flickr

DETROIT (AP) - The most anticipated vote in Detroit this summer isn't for a city office.

Instead, ballots due by Friday from city retirees could determine how quickly Detroit exits its historic bankruptcy and how much of the financial weight pensioners will bear.

Non-uniformed retirees are being asked to take a 4.5 percent pension cut and no cost-of-living allowances. Police and fire retirees are faced with reduced cost-of-living payments.

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Families & Community
11:21 am
Fri June 27, 2014

Experiencing Detroit's blight digitally is getting interesting

There are over 43,000 pictures in the interactive from The New York Times.
Credit Screen shot of NYT interactive

I timed myself and it took me a minute and 21 seconds to scroll through the images of Detroit's blight. Initially, I didn't even read any of the analysis that The New York Times provided, I just scrolled. 

The Times has done several interactive pieces on blight in Detroit. There's been a wealth of data since the Detroit Blight Removal Task Force Plan was published.

This one really makes you realize how vast the city's housing problem actually is.

Their analysis breaks blight up geographically with different anecdotes and facts. Here are two examples:

7 Mile Road:

While most of the properties on the foreclosure list were residential, about 5 percent were sites of former businesses, of which a majority were vacant lots or unoccupied structures. Many were formerly gas stations, auto body shops and car washes. 

Lenox Street:

Ronald Ford Jr. says he has struggled to find work as a laborer and to pay his bills, let alone the $7,000 in property taxes that he now owes. His family bought the house in 1969, and his mother made the final mortgage payment years ago. But he said they stopped paying the taxes after she grew ill and moved into a nursing facility.  

-- Lucy Perkins, Michigan Radio Newsroom

Education
7:00 am
Fri June 27, 2014

The Best Classroom Project: Helping Detroit parents navigate a confusing school landscape

Jason and Dara Hill, with daughter Norah, at home in Indian Village.
Credit Sarah Cwiek / Michigan Radio

This week, the Detroit Journalism Cooperative is looking at how the city is functioning under bankruptcy.

Mayor Mike Duggan says his top priority is reversing the city’s long population decline.

But there are a couple key quality of life issues Duggan has no control over. One of them is the city’s schools.

Here’s the story of one Detroit family’s effort to find good schools.

Meet the Hills

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Law
6:00 am
Fri June 27, 2014

Detroit judge agrees to city tour, but asks for security precautions

Credit Sam Beebe

The judge in charge of Detroit’s bankruptcy case tentatively agreed Thursday to tour parts of the city—despite concerns about his safety.

City lawyers have been pushing Judge Steven Rhodes to take a city bus tour for some time now.

They say the judge needs to see the conditions in Detroit neighborhoods firsthand, to help him make informed decisions in the case.

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