Michigan Senate approves $195 million for Detroit - FOX 32 News Chicago

Michigan Senate approves $195 million for Detroit

Posted: Updated:
LANSING, Mich. (AP) -- Michigan's Senate approved on Tuesday spending $195 million to help prevent steeper cuts in Detroit retiree pensions, linking the state with a deal designed to shield valuable city-owned art from being sold and resolve the largest public bankruptcy in U.S. history.
 
The Republican-led chamber voted 21-17 to contribute the state funds to join $466 million in commitments from 12 foundations and the Detroit Institute of Arts. The pool of money would shore up Detroit's two retirement systems while the city-owned art museum and its assets would be transferred to a private nonprofit.
 
Gov. Rick Snyder is expected to sign the legislation quickly after a required technical move by the GOP-controlled House, which passed the bills about two weeks ago.
 
By backing the deal, the governor and legislators in part are hoping to avoid a protracted bankruptcy and the potential for city retirees to fall into poverty, which could cost the state an estimated $270 million in social safety net costs over 20 years. They also say that Michigan as a whole cannot succeed unless its largest city is turned around.
 
"This is by far, in my opinion, the best that we're going to be able to do," said Senate Majority Leader Randy Richardville, R-Monroe. "It's not for the city of Detroit. This money goes directly to the people that earned those pensions ... who through no fault of their own are at risk."
 
Bond insurers have pointed to the art collection -- which includes Van Gogh's "Self Portrait" -- as a possible billion-dollar source of cash in the 10-month-old bankruptcy case. The city firmly opposes that and instead is banking on the separate deal brokered by mediators that would protect the art forever and limit base pension cuts for approximately 30,000 retirees and city workers to no more than 4.5 percent instead of as much as 26 percent.
 
The up-front state payment, the equivalent of $350 million spread over 20 years, would come from the state's rainy day account and would be repaid with annual $17.5 million withdrawals from Michigan's tobacco settlement over 20 years. Under the plan, a state-dominated board could oversee the city's finances for as few as three years or for decades, depending on whether its books are balanced.

Mayor Mike Duggan released this statement:

"Today's vote by the Senate to approve $195 million in financial aid for the city of Detroit will help us honor the contract we made with our city retirees. We all owe a debt of gratitude to Senate Republican Leader Randy Richardville and Democratic Leader Gretchen Whitmer for
their leadership on this issue. The kind of bi-partisan support we are seeing in Lansing right now is a clear sign of a new beginning for the
city of Detroit."

 

  • Local NewsLocal NewsMore>>

  • Two arrested after federal agent shootout in Highland Park

    Two arrested after federal agent shootout in Highland Park

    Friday, August 1 2014 8:38 PM EDT2014-08-02 00:38:26 GMT
    In what started as a traffic stop, resulted in a shootout between federal agents and a pair of men known to have illegal assault rifles in Highland Park.Police say a task force of ATF and FBI agents who had previously set up a meet with two men, known to have AK-47s and AR-15s in their Chevrolet Cavalier, began to move in. The traffic stop was made near Oakland and Victor about 7:30 p.m. Friday. The car rammed the federal agents vehicle and the driver opened fire with a handgun. The agents re...
    In what started as a traffic stop, resulted in a shootout between federal agents and a pair of men known to have illegal assault rifles in Highland Park.Police say a task force of ATF and FBI agents who had previously set up a meet with two men, known to have AK-47s and AR-15s in their Chevrolet Cavalier, began to move in. The traffic stop was made near Oakland and Victor about 7:30 p.m. Friday. The car rammed the federal agents vehicle and the driver opened fire with a handgun. The agents re...
  • New DTE app lets users check their energy use

    New DTE app lets users check their energy use

    Friday, August 1 2014 7:59 PM EDT2014-08-01 23:59:24 GMT
    Joel Miller, a senior strategist with DTE Energy, gave us some insight -- on DTE insight. The new, free smart phone app helps customers see their energy use hour by hour -- or minute by minute."By studying your data and by looking around your home you can discover what things are using energy," Miller said. Then, you make choices -- replace appliances or physically turn off whatever's not needed -- or is wasting energy, and save money on your energy bill in the process."I think for a lot of u...
    Joel Miller, a senior strategist with DTE Energy, gave us some insight -- on DTE insight. The new, free smart phone app helps customers see their energy use hour by hour -- or minute by minute."By studying your data and by looking around your home you can discover what things are using energy," Miller said. Then, you make choices -- replace appliances or physically turn off whatever's not needed -- or is wasting energy, and save money on your energy bill in the process."I think for a lot of u...
  • Backyard Bliss: The Brown family's backyard

    Backyard Bliss: The Brown family's backyard

    Friday, August 1 2014 7:07 PM EDT2014-08-01 23:07:48 GMT
    Living is easy in the summertime, and some of the very best times are often found right in our own backyard.
    Living is easy in the summertime, and some of the very best times are often found right in our own backyard.
  • Download the FOX 2 Apps


  • FOX 2 News Five-Day Forecast
Powered by WorldNow

205 N. Michigan Avenue
Ground Floor
Chicago, IL 60601
Station Operator: (312) 565-5532
Newsroom: (312)565-5533

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | New Terms of Service What's new | Ad Choices