Detroit bankruptcy

Law
7:22 am
Fri November 8, 2013

Closing arguments set to begin in Detroit bankruptcy trial

Closing arguments start Friday in Detroit’s bankruptcy eligibility trial.

Witness testimony wrapped up this week, with former State Treasurer Andy Dillon and one of Governor Snyder’s top aides, Rich Baird, both taking the stand.

Dillon testified that he was “skeptical” after seeing Detroit emergency manager Kevyn Orr’s June proposal to city creditors, which included steep cuts to unsecured creditors, including pensions.

Read more
Law
1:50 pm
Thu November 7, 2013

Former state Treasurer Andy Dillon finishes Detroit bankruptcy testimony

Former state Treasurer Andy Dillon.
Associated Press

Former state Treasurer Andy Dillon finished his testimonial in Detroit’s bankruptcy trial, bringing his three-day testimonial to a close.

On Tuesday, Dillon defended his recommendation for Detroit’s bankruptcy filing, saying it was a “last-resort option.” But some of Detroit's creditors are arguing that the decision to file for Chapter 9 bankruptcy was not exactly a last resort, but instead a quick decision that overlooked an opportunity to continue negotiations.

Read more
Detroit bankruptcy
3:38 pm
Mon November 4, 2013

Orr questioned on 'sacrosanct' comment in Day 6 of Detroit bankruptcy trial

Here's the comment Detroit Emergency Manager Kevyn Orr made to a public meeting on June 10, 2013. It's on loop, in case you miss it the first go 'round:

This statement was played for the courtroom by a lawyer representing the city's pension funds. He was trying to prove that Orr misled pensioners days before proposing cuts to pensions.

The Detroit News' Chad Livengood and Robert Snell report on the exchange that followed:

“Despite the implications, I wasn’t attempting to mislead anyone,” Orr testified Monday under questioning from city attorney Greg Shumaker.

Orr’s answer caused U.S. Bankruptcy Judge Steven Rhodes to interrupt with a follow-up question.

“Excuse me one second,” the judge said. “What would you say to that retiree now?”

“I would say his rights are in bankruptcy now,” Orr told the judge. “I would say his rights are subject to the supremacy clause of the U.S. Constitution.”

“That’s a bit different than sacrosanct, isn’t it?” Rhodes replied.

Orr continued to deny allegations that there was no attempt to negotiate with creditors "in good faith" prior to the city's bankruptcy filing. It's a pivotal point lawyers for the city's creditors are trying to prove. If they can do it, the city might not be eligible to reorganize under the protection of federal bankruptcy laws.

Orr ended his testimony this morning around 11 a.m.

Next to the witness stand, Snyder aide Richard Baird and former state treasurer Andy Dillon.

Politics & Government
6:48 am
Mon November 4, 2013

In this morning's headlines: Detroit bankruptcy, problem solving lacking, new Tigers manager

User: Brother O'Mara flickr

Detroit bankruptcy eligibility trial resumes

"Detroit emergency manager Kevyn Orr is returning to court today as a witness in the sixth day of the city's bankruptcy trial.  Unions and pension funds are asking Judge Steven Rhodes to throw out Detroit's Chapter 9 filing or at least protect the pensions of city retirees. They accuse Orr and his staff of failing to engage in "good-faith" negotiations before the petition was filed in July, a key step under federal law. Orr says creditors had plenty of time to come up with proposals," the Associated Press reports.

Report says few 8 year olds have problem solving skills

A new report out this morning by the Annie E. Casey Foundation says only about one in three children 8 years old and younger have developed the necessary learning and problem solving skills they’ll need as adults.

Brad Ausmus new Detroit Tigers manager

"The Detroit Tigers have chosen Brad Ausmus as their new manager. The former catcher will replace Jim Leyland at the helm of the three-time defending AL Central champions," the Associated Press reports.

Law
3:49 pm
Sat November 2, 2013

Detroit, bankruptcy creditors talking in private

(file photo)
Steve Carmody/Michigan Radio

DETROIT (AP) - While a judge determines the future of Detroit's bankruptcy case, key people are meeting behind the scenes to try to reach deals.

Private mediation sessions are scheduled for Wednesday, at the same time the city tries to convince a judge that Detroit is eligible to fix its debts in bankruptcy court. The trial in front of Judge Steven Rhodes started on Oct. 23.

Politics & Government
8:55 am
Sat November 2, 2013

Lessenberry talks elections, Detroit bankruptcy trial and Isle Royale's 'wasteful spending'

Dave Linabury Flickr

Week in review interview for 11/2/13

This Week in Review Rina Miller and Jack Lessenberry discuss next week's elections, the Detroit bankruptcy eligibility trial and the accusation by a Senator from Oklahoma that Isle Royale is wasting money and is not worthy of preservation.

Politics & Government
4:50 pm
Wed October 30, 2013

A look inside Detroit bankruptcy trial

State lawmakers have passed bills allowing the city to keep taxing at certain rates. The legislation awaits Governor Snyder's approval.
Bob Jagendorf Flickr

This week, Judge Steven Rhodes has been hearing testimony to decide whether Detroit is eligible for Chapter 9 bankruptcy protection. Both Governor Rick Snyder and Detroit Emergency Manager Kevyn Orr have testified in the case. Michigan Radio’s Sarah Cwiek has been covering the hearings and she joins us to talk about the atmosphere in the courtroom.

Listen to the full interview above.

Politics & Government
9:14 pm
Tue October 29, 2013

Highlights from Governor Snyder's, Kevyn Orr's testimony in Detroit bankruptcy trial

LiveStream

Both Detroit Emergency Manager Kevyn Orr and Governor Snyder testified this week in the trial that will decide whether Detroit is eligible for Chapter 9 bankruptcy protection.

Facing hours of pointed questions from lawyers for city unions, retirees, and pension funds, both Snyder and Orr said that bankruptcy wasn’t a foregone conclusion for Detroit.

But both also insisted the city was clearly insolvent, creditor talks had broken down into multiple lawsuits, and Orr had to move quickly.

“It was somewhat shocking how dire it was,” Orr testified.

Read more
Newsmaker Interview
5:04 pm
Tue October 29, 2013

Did the state negotiate in good faith at the Detroit bankruptcy hearing?

This week, Bankruptcy Judge Steven Rhodes is hearing arguments on whether the city of Detroit is eligible for Chapter 9 bankruptcy protection. Both Governor Snyder and Detroit Emergency Manger Kevyn Orr have testified. They argue that bankruptcy is Detroit’s only path to solvency.

John Pottow weighed in on the matter on today's Stateside program. Pottow is professor of law at the University of Michigan who specializes in bankruptcy and consumer protection.

"I think the hardest issue about this is this Michigan constitutional provision about protecting the pensions," Pottow said. "This gets to what's animating the objectors and the unions is, why would the governor want to rush Detroit into bankruptcy? It's not what people generally clamor toward. And their concern is that because of this protection the workers have under the state constitution, that the governor might be trying to use the federal bankruptcy law as a way to get around the Michigan constitution."

Listen to the full interview above.

Detroit Bankruptcy
2:43 pm
Tue October 29, 2013

Sharp exchange between bankruptcy judge and Detroit's emergency manager

Detroit's emergency manager, Kevyn Orr.
screen grab NBC Video

It's Day 5 of the Detroit bankruptcy trial and the man at the center of the bankruptcy filing took the stand for the third time.

Detroit Emergency Manager Kevyn Orr filed the bankruptcy paperwork with the court last July.

Now Bankruptcy Judge Steven Rhodes will decide whether the city can be protected from creditors by entering into Chapter 9 bankruptcy. He's expected to make his decision sometime in mid-November.

Read more
Politics & Government
3:56 pm
Mon October 28, 2013

Detroit bankruptcy hearings continue as EM and Gov. Snyder take stand

Detroit's skyline
Joy VanBuhler Flickr

U.S. Bankruptcy Judge Steven Rhodes is presiding over the fourth day of testimony in the Detroit bankruptcy case.

At issue...

  1. Is it true that Detroit can no longer pay its bills?
  2. Did city leaders negotiate with creditors "in good faith" before filing for bankruptcy protection?

Two of the main players in the bankruptcy filing are in court today.

Detroit's state-appointed emergency manager Kevyn Orr took the stand last Friday and again this morning.

Read more
Politics & Government
2:54 pm
Mon October 28, 2013

Facts about the Detroit bankruptcy

Detroit skyline.
Dave Linabury Flickr

With the bankruptcy trial in full swing, we thought we'd share the following facts with you about the Detroit bankruptcy case.

 

  • State declares Detroit is in a “financial emergency” on March 1, 2013

  • Kevyn Orr appointed as Detroit’s emergency manager on March 14, 2013

  • City files for Chapter 9 bankruptcy on July 18, 2013

Read more
Politics & Government
8:41 am
Sat October 26, 2013

Detroit City Council has no alternative to $350M loan plan to pay off city's debt

Downtown Detroit (file photo)
Steve Carmody/Michigan Radio

DETROIT (AP) - The Detroit City Council has decided not to push an alternative to a $350 million loan designed to help the city pay off some of its massive pension debt.

Council members on Friday discussed the competing plan to the post-bankruptcy petition financial proposal engineered by state-appointed emergency manager Kevyn Orr.

About $230 million from Barclays would be used to fully pay off a complicated pension debt deal involving two major creditors. The rest would be used to improve basic city services.

Read more
Politics & Government
4:25 pm
Fri October 25, 2013

Day 3 in the Detroit bankruptcy case could bring Orr and police chief to the stand

Gerri Trager Flickr

Update 4:25 p.m.

Emergency manager Kevyn Orr has taken the stand in Detroit bankruptcy eligibility trial, for what's likely to be a brief bit of testimony before court breaks for the weekend.

The court confirmed that Governor Snyder will take the stand at 1 p.m. on Monday, regardless of whether Orr is finished testifying.

Orr follows Detroit Police Chief James Craig, who testified about the poor state of police service in Detroit when he took over the job in July 2013.

He called Detroit "the most violent city I've ever worked in" (he's also worked for police departments in Los Angeles and Cincinnati).

He said the city needs to take "bold action" to rectify its fiscal problems, but acknowledged he was "concerned" about "hiring and retention issues" if Detroit is allowed to slash pension benefits in bankruptcy.

1:11 p.m.

At issue is whether the state (mostly Gov. Rick Snyder) and city​ leaders (mostly Kevyn Orr) truly negotiated "in good faith" with Detroit's creditors.

Those who stand to lose a lot (city union workers and retired pensioners, among many others) are arguing that bankruptcy was the goal all along - that there was no "good faith" bargaining going on.

We're in Day 3 of hearings in front of the man who will ultimately decide whether Detroit will become the largest city in U.S. history to go bankrupt.

We're not expected to get a ruling from U.S. Bankruptcy Judge Steven Rhodes until mid-November.

This morning there was testimony from Kenneth Buckfire, an investment banker who worked with the city of Detroit. Buckfire was questioned about the timing of his negotiations with Gov. Snyder and the city over the city's insolvency.

Read more
Politics & Culture
5:05 pm
Wed October 23, 2013

Stateside for Wednesday, October 23rd, 2013

A new study found that students enrolled in online charter schools are not performing as well as students in traditional brick and mortar schools. At the same time the number of virtual schools is growing. On today's show, we talked about the big business of online charter schools.

And, how do you talk about being gay and Christian? And how should we be talking about it? We spoke to the founder of the Gay Christian Network to learn more.

And, could eating local save energy and help the planet? We took a closer look at the impact of the local food movement.

Also, Jen Guerra from Michigan Radio’s State of Opportunity project joined us to give a preview of her upcoming documentary, “The Education Gap.”

First on the show, is Detroit really broke?

That’s the question before Federal Bankruptcy Judge Steven Rhodes as Detroit’s bankruptcy eligibility trial began today. His ruling could open the door for the City of Detroit blowing up billions of dollars in debt and liabilities.

As has been the case ever since the bankruptcy filing on July 18th, this is all being closely watched from coast to coast. History is being written in Judge Rhodes' courtroom.

Daniel Howes, Detroit News Business Columnist, and the former Chief of Communications for the City of Detroit, Karen Dumas, joined us today to talk about what this trial means and what we might see.

Stateside
3:33 pm
Wed October 23, 2013

What can we expect from the Detroit bankruptcy trial?

Peter Martorano Flickr

Is Detroit really broke?

That’s the question before Federal Bankruptcy Judge Steven Rhodes as Detroit’s bankruptcy eligibility trial began today. His ruling could open the door for the City of Detroit blowing up billions of dollars in debt and liabilities.

As has been the case ever since the bankruptcy filing on July 18th, this is all being closely watched from coast to coast. History is being written in Judge Rhodes' courtroom.

Daniel Howes, Detroit News Business Columnist, and the former Chief of Communications for the City of Detroit, Karen Dumas, joined us today to talk about what this trial means and what we might see.

Listen to the full interview above.

Politics & Government
11:53 am
Wed October 23, 2013

Can Detroit really get bankruptcy protection? Hearing starts today, Snyder to testify Monday

Judge Rosen will decide whether the city can protect itself from creditors under bankruptcy protection.
Detroit Legal News

Detroit is NOT in bankruptcy. Not yet, anyway.

That's what the bankruptcy hearing, which started today, is all about.

The federal bankruptcy judge will decide whether the city is allowed to protect itself from close to 100,000 creditors under Chapter 9 bankruptcy laws.

We found out this morning that Michigan Gov. Rick Snyder, the man who ultimately signed off on Detroit's bankruptcy filing, will testify in the Detroit bankruptcy trial on Monday.

Unions had served Snyder with a subpoena, but his live testimony appeared to be an unsettled issue earlier this week.

Gov. Snyder's lawyer argued that the Snyder's recent three-hour deposition should be enough.

But now his counsel says the governor wants to cooperate and will be available Monday afternoon.

Unions and pension funds want to question Snyder about approving Detroit's bankruptcy filing in July as well as other issues related to the case.

They will try to prove to the bankruptcy judge that Gov. Snyder and Detroit's emergency manager Kevyn Orr had bankruptcy in mind all along - that they did not negotiate in good faith with the creditors ahead of time.

Michigan Radio's Sarah Cwiek is live tweeting from today's hearing. Lawyers for the city have already argued in favor of bankruptcy this morning. Now it's time for those opposed to bankruptcy to argue. Here's how Cwiek sums up what their arguments will be:

 

 

Opinion
8:49 am
Wed October 23, 2013

Detroit bankruptcy on trial

Lessenberry commentary for 10/23/13

Well, today is the day that the City of Detroit goes to court. Bankruptcy court, that is. Not to settle the final details of what will happen, but to ask the judge to allow it to declare bankruptcy.

This has been going on so long now that there’s a tendency to take Detroit bankruptcy as an established fact. In fact, all that has happened is that the Emergency Manager, Kevyn Orr, filed a petition in July asking to be allowed to declare bankruptcy. Since then, we’ve been treated to a long series of revelations that make bankruptcy appear the only option.

Detroit has close to $20 billion dollars in unfunded liabilities, and next to no assets. It wouldn’t make much of a dent if they sold the entire collection of the Detroit Institute of Arts, and then sold the building to a billionaire who wanted a mausoleum.

Read more
Politics & Government
8:39 am
Wed October 23, 2013

Jack Lessenberry talks Detroit bankruptcy, NERD fund and fracking

State lawmakers have passed bills allowing the city to keep taxing at certain rates. The legislation awaits Governor Snyder's approval.
Bob Jagendorf Flickr

Week in Michigan Politics interview for 10/23/13

In this Week in Michigan Politics, Christina Shockley and Jack Lessenberry discuss Detroit's bankruptcy eligibility trial, Governor Snyder's NERD fund, and new proposed fracking rules.

Read more
Law
8:00 am
Wed October 23, 2013

Is Detroit eligible for bankruptcy? Crucial trial starts today

A trial to determine Detroit’s fate in municipal bankruptcy starts Wednesday.

Judge Steven Rhodes will hear arguments from city lawyers about why Detroit qualifies for Chapter 9 protection.

University of Michigan law professor and bankruptcy expert John Pottow says some city creditors will argue that Detroit’s bankruptcy filing was pre-determined--and there was no good-faith bargaining process, as the federal bankruptcy code requires.

Read more

Pages