GRS Pension Board approves bankruptcy deal

GRS Pension Board approves bankruptcy deal

The board overseeing the fund for the city’s non-uniform pension system unanimously approved a deal negotiated by attorneys for the retirees and the city, according to a Detroit Free Press report this afternoon.

The negotiated agreement would reduce payments for about 18,000 pensioners by 4.5 percent and scrap cost-of-living-adjustment (COLA) increases, the newspaper says. It also contains a provision that pensioners could pay back up to 20 percent of annuities they previously received. This proposed agreement comes a day after the association for retired police officers and firefighters approved a deal with no deductions from monthly pension checks and reduced — but retained — COLA increases for the roughly 6,500 people in that system.

Emergency Manager Kevyn Orr’s latest public offer was for up to 34 percent cuts for non-uniform pensioners and up to 14 percent for police and fire.

The Freep reports:

The board, which passed a motion in support of the cuts 7-0, released a statement after the vote today.

“There has been a lot of uncertainty and anxiety among our members and retirees. It is our responsibility to bring to our members and retirees the best possible deal with the best possible outcome for their consideration. The motion we passed today represents progress that allows us to move forward to continue to negotiate other details for a final settlement agreement.”

As part of the bankruptcy process, the two groups of pensioners involved will need to approve the plan through voting that will take place in May and June. Emergency Manager Kevyn Orr’s “Grand Bargain” requires approval of the two pension settlements in order to secure foundation and private monies — and future state funds — to protect the Detroit Institute of Arts collection from sale and to better fund the pension system.

With pensioners’ leadership expected to campaign for approval of the deals and the foundation and private money secured, the proverbial ball moves to a Lansing court in the ongoing Chapter 9 proceedings.