A judge's decision to allow Detroit to fix its finances in bankruptcy court raises a flurry of questions about what happens next. Here's a look at what's known about the next steps:
A judge’s decision to allow Detroit to fix its finances in bankruptcy court raises a flurry of questions about what happens next. Here’s a look at what’s known about the next steps:
WHAT HAPPENS IN COURT?
Bankruptcy opponents want to file appeals immediately to the 6th U.S. Circuit Court of Appeals in Cincinnati, a move that could put the case on hold. They believe Judge Steven Rhodes is wrong in saying pensions can be cut, among other issues.
WHAT HAPPENS IN DETROIT?
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The judge has told the city to come up with a plan to exit bankruptcy by March 1. But the city’s emergency manager, Kevyn Orr, says he’d like to have one ready weeks earlier. The plan could include anything from selling assets, such as art, to cutting pensions and more. Detroit would need the support of creditors and the judge to emerge from bankruptcy.
HOW LONG WILL IT TAKE?
Detroit is by far the largest city to go bankrupt and the timeframe isn’t known, especially because of appeals. Orr would like to get it done by next fall when his term ends as manager. Experts also warn the city’s legal bills and those of creditors will soar.
WILL THE LIGHTS GO OUT?
Orr says a ruling in favor of bankruptcy will allow the city to keep paying bills incurred since July 18. And it can keep police on the streets, firefighters on duty and streetlights aglow. City leaders have said those services have improved since the city filed for bankruptcy and police response times were near an hour.