In Orr’s Words: Excerpts from the EM’s Statement

In Orr’s Words: Excerpts from the EM’s Statement

Detroit Emergency Manager Kevyn Orr’s office has released a statement about the city’s Plan of Adjustment and Disclosure Statement filed today in U.S. Bankruptcy Court.

Here’s what the city considers the highlights of the plan:

* Devotes $1.5 billion over 10 years to capital improvements, blight removal and equipment and technology upgrades.

* During the next five years, up to $500 million of the $1.5 billion will go toward blight removal.

* Proposes 20 percent payment to unsecured, non-retiree creditors in the form of new securities from the city and a pledge to increase that if the city’s finances improve.

* Assumes $465 million from third-party donors and the Detroit Institute of Arts toward the pension funds over two decades, subject to city and pension fund agreement and conditions.

* Includes Gov. Rick Snyder’s proposal to send $350 million of state money to Detroit over 20 years.

* Allows that if police and fire pensioners agree to the plan and there is some settlement with the state, they could receive more than 90 percent of their pensions with the elimination of cost-of-living allowances. General retirees cold receive in excess of 70 percent of their pensions after elimination of cost of living allowances.

* Moves current city employees into defined benefit plans.

In other development, mediations continue toward agreements with key creditors in the process overseen by Chief U.S. District Judge Gerald Rosen. Talks are ongoing for the interest-rate, pension debt swaps agreement as well as the future of the Detroit Water and Sewerage Department.