The City of Detroit’s Eighth Amended Plan for the Adjustment of Debts became effective, and the City emerged from Chapter 9 protection. The Court confirmed the Plan on November 12, 2014. Plan effectiveness also represents consummation of the Grand Bargain between the City of Detroit, the State of Michigan, the twelve foundations represented by an affiliate of the Community Foundation for Southeast Michigan and The Detroit Institute of Arts. The Grand Bargain, labeled the Plan’s “cornerstone” by Judge Rhodes, is the global transaction that involves (1) the contributions of $366 million by the foundations, $100 million by the Detroit Institute of Arts (DIA) and nearly 50 foundations, corporations and individual donors supporting the DIA and $350 million by the State of Michigan, all for the benefit of City of Detroit pensioners and retirees; (2) the conveyance by the City of Detroit to the DIA of all of the City’s interests in all museum assets and (3) the commitment by the DIA to hold the museum assets in trust for the benefit of the residents of the City of Detroit, counties of Macomb, Oakland and Wayne and the State of Michigan in perpetuity. As a result of the City’s emergence, Michigan Governor Rick Snyder terminated the appointment of Kevyn Orr as the City’s emergency manager. Orr commented, “There remains much work for the city to complete and much yet to accomplish. I hope and firmly believe that the city’s leadership can continue to build on the solid foundation the restructuring process has created for them.” The municipality filed for Chapter 9 protection on July 18, 2013, listing total assets greater than $1 billion.
About Ben Schlafman
Ben Schlafman is a University of Rhode Island graduate in Political Science and Marketing who got his start selling and promoting bankruptcy and distressed data products for New Generation Research, Inc. With over 8 years of hands on experience in the bankruptcy and distressed sectors, Ben writes, manages and supports an array of restructuring products under the New Generation Research umbrella.