The City of Detroit could move one step closer to exiting bankruptcy today when U.S. Bankruptcy Judge Steven Rhodes announces his decision on whether to approve the City’s plan of adjustment. The City hopes Judge Rhodes will approve its plan, which calls for $275 million in new borrowing and a $1.7 billion reinvestment in removing blighted buildings and boosting police and fire services in the City. If approved, the City will be poised to exit bankruptcy by Thanksgiving, more than 16 months after first entering chapter 9.
While all major financial creditors have settled with the City and now back the City’s plan, several hundred individual objectors – mostly retirees whose pension benefits will get cut – have not backed away from their objections to the Plan. It remains unclear whether the individual objectors have the organization or will to fight the approval of the Plan through the appellate system. Regardless, the City’s leaders will surely hail bankruptcy court approval of the Plan as a historic victory that will kick-start the City’s renaissance.