The Herald Bulletin

Morning Update

Nation & World

August 20, 2013

Creditors file objections to Detroit bankruptcy

(Continued)

DETROIT —

He filed for bankruptcy on July 18, claiming the city has at least $18 billion in liabilities, from underfunded pensions and health care costs to bonds that lack city revenue to be paid off.

Orr also stopped payment on $2.5 billion in debt in June.

Michigan Attorney General Bill Schuette, who earlier joined the battle on behalf of city pensioners, wrote in a 20-page statement filed Monday in federal court that constitutional protections cannot be stepped on.

"No reasonable person can disagree that the city of Detroit is bankrupt and that federal bankruptcy proceedings under the leadership of emergency manager Kevyn Orr is the only avenue to rebuild the Motor City," Schuette, a Republican, said in a release. "However, throughout this bankruptcy process, protections enshrined in the Michigan Constitution ... must be honored, respected and followed."

That contention also will be part of the objections that will be filed by the city's two employee pension systems, said Bruce Babiarz, spokesman for Detroit's Police and Fire Retirement System and General Retirement System.

The systems are the city's two largest unsecured creditors.

Detroit has about 21,000 retired workers who are owed benefits, with underfunded obligations of about $3.5 billion for pensions and $5.7 billion for retiree health coverage.

Mary Dugans, one of those retirees, filed an individual objection Monday.

"I need my pension for basic human needs," she wrote in her one-page filing. "Additionally, I'm 80 years old with age related medical conditions. Therefore, I have to pay for medical co-pays as well as for prescribed medications. Please consider my situation as you approach this important matter. Thanks."

Monday's deadline for objections drew protesters outside federal court in Detroit.

Some in a group of about 30 people amassed outside the building said in their filings that there are no provisions in Chapter 9 that gave Orr authority to file the bankruptcy petition and that it was done without consent of the city's elected representatives.

Text Only
Nation & World
  • Doctor: Patient killed caseworker before gunfight

    A doctor told police that a patient fatally shot a caseworker at their hospital complex before the doctor pulled out his own gun and exchanged fire with him and wounded him, a prosecutor said Thursday night.

    July 25, 2014

  • Alaska vintage tourist train to resume Friday

    A vintage rail company that transports hundreds of thousands of tourists a year along the route of the historic Klondike Gold Rush suspended operations while it investigates a derailment that left 23 people with minor injuries, officials said.

    July 25, 2014

  • Social Security spent $300 million on 'IT boondoggle'

    Six years ago the Social Security Administration embarked on an aggressive plan to replace outdated computer systems overwhelmed by a growing flood of disability claims. Nearly $300 million later, the new system is nowhere near ready and agency officials are struggling to salvage a project racked by delays and mismanagement, according to an internal report commissioned by the agency.

    July 24, 2014

  • Plane crashes in Taiwan, 47 trapped, feared dead

    A plane landing in stormy weather crashed outside an airport on a small Taiwanese island late Wednesday, and a transport minister said 47 people were trapped and feared dead.

    July 23, 2014

  • US pushes for truce as Gaza battle rages

     Israeli troops battled Hamas militants on Wednesday near a southern Gaza Strip town as the U.S. secretary of state reported progress in efforts to broker a truce in the conflict that has so far killed at least 657 Palestinians and 31 Israelis.

    July 23, 2014

  • Bodies of Malaysia jet victims leave Ukraine

    Two military aircraft carrying the first bodies of victims of the Malaysia Airlines crash left the embattled plains of eastern Ukraine Wednesday, and pro-Russian rebels shot down two Ukrainian fighter jets as fighting flared in the region.

    July 23, 2014

  • Perdue defeats Kingston in Georgia Senate runoff

    Businessman David Perdue has defeated longtime Rep. Jack Kingston in the Republican runoff for Georgia's U.S. Senate nomination, setting up a nationally significant general election matchup against Democrat Michelle Nunn.

    July 22, 2014

  • New arrest linked to gun used after Boston attacks

    A friend of Boston Marathon bombing suspect Dzhokhar Tsarnaev is believed to have provided the handgun used to kill a Massachusetts Institute of Technology police officer during the manhunt, people with knowledge of the investigation said Tuesday.

    July 22, 2014

  • California firm issues nationwide fruit recall

    A Central California company is recalling specific lots of its fresh peaches, plums, nectarines and pluots sold nationwide over concerns of possible listeria contamination.

    July 22, 2014

  • Obama nominee McDonald pledges to 'transform' VA

    President Barack Obama's choice to lead the Department of Veterans Affairs pledged Tuesday to transform the beleaguered agency, saying that "systematic failures" must be addressed.

    July 22, 2014