Powers of the Debtor
Due to statutory limitations placed upon the power of the court in a municipal debt adjustment proceeding, the court is far less involved in the conduct of a municipal bankruptcy case (and in the operation of the municipal entity) while the debtor's financial affairs are undergoing reorganization. The municipal debtor has broad powers to use its property, raise taxes, and make expenditures as it sees fit. It is also permitted to adjust burdensome non-debt contractual relationships under the power to reject executory contracts and unexpired leases, subject to court approval, and it has the same avoiding powers as other debtors. Municipalities may also reject collective bargaining agreements and retiree benefit plans without going through the usual procedures required in chapter 11 cases.
A municipality has authority to borrow money during a chapter 9 case as an administrative expense. 11 U.S.C. §§ 364, 901(a). This ability is important to the survival of a municipality that has exhausted all other resources. A chapter 9 municipality has the same power to obtain credit as it does outside of bankruptcy. The court does not have supervisory authority over the amount of debt the municipality incurs in its operation. The municipality may employ professionals without court approval, and the professional fees incurred are reviewed only within the context of plan confirmation.
Originally posted by Helious
The city looks like a war zone, literally.
Originally posted by HauntWok
Good. Detroit has been bankrupt for a long time. This should help matters a bit. Hopefully they will have to restructure the government of the city as well. Maybe they won't have anymore "at large" councilpersons.
This is what happens when you have TOO MUCH liberal ideology running the politics of a government.
-Trash pick up
-Emergency response like police, fire, and medical
-Road maintenance like potholes filled, red lights operating properly, road signs in place and displaying correct information, and street sweeping/cleaning
-Public transportation, the poorest generally rely on buses the most
Or is it just plain corruption.
Originally posted by PsykoOps
First thought I had was the scifi series continuum. In it in the future the government goes into too much debt and the private sector and corporations bail out the government. Basically they buy out the debt and save the country but in the process take over completely. All branches of government are corporate after that. Scariest scifi scenario I've seen in a long time.
Originally posted by madmac5150
Looks like progressive politics is a rousing economic success... Detroit has been run by the progressives and labor unions for a very long time. Look to them to restore hope and change in the Motor City...
Man, my sarcasm meter is pegged today...
A number of factors — most notably steep population and tax base falls — have been blamed on Detroit’s tumble toward insolvency. Detroit lost a quarter-million residents between 2000 and 2010. A population that in the 1950s reached 1.8 million is struggling to stay above 700,000. Much of the middle-class and scores of businesses also have fled Detroit, taking their tax dollars with them.
Detroit’s two pension funds on Wednesday sued emergency manager Kevyn Orr and Gov. Rick Snyder in an attempt to block Orr from slashing pension benefits for thousands of current and active city workers as part of his plan to restructure the city’s massive debt. The lawsuit asks the Ingham County Circuit Court to declare that Snyder cannot authorize Orr to take any actions — including filing for municipal bankruptcy — that would cut pension benefits, which the lawsuit says are protected by the state constitution.
reply to post by tothetenthpower
Grab your popcorn...pull up a chair....history is being made as this is the largest municipal bankruptcy in history.