Detroit, currently under the governance of an emergency manager, seems destined for bankruptcy or mass default (it has already begun to default on some of its credit payments. Either scenario will be groundbreaking in municipal finance and in the power relationships between bankers, retirees, cities, and states. The impending battle between people living on fixed…
Tag: bankruptcy
Court to Decide on Pensions in Stockton, Calif., Bankruptcy – NYTimes.com
Wall Street is taking America’s biggest pension fund to court this week, for a long-awaited battle over who takes the losses when a city goes bust — workers and retirees, municipal bondholders, or both. California is being closely watched as battles in San Bernardino and Stockton look to reshape how pensions are treated…
Michigan’s Emergency Manager Law: Good for banks, not so good for people
Michigan’s Emergency Manager law is a big part of my dissertation, so I haven’t written about it much here. But after wading through the overwhelming media support for Proposition 1, which will affirm the Emergency Manager law passed by Republicans in 2011, a rare piece on the underlying issues caught my eye: Those who like…
“The Municipal Sandwich”
The municipal bond market’s view of city budget woes, via Goodwin Procter’s take on the Pew report about struggling cities (which is worth reading): A recent report issued by The Pew Charitable Trusts American Cities Project describes how the Great Recession has sandwiched municipalities between an increased demand for services and an inability to raise…
Fitch weighs in on Michigan’s Emergency Manager law
Fitch Ratings issued a press release on the situation with Michigan’s Emergency Manager law (right now the court is weighing whether to put on the fall ballot a measure to repeal the current version of the emergency manager law, under which Detroit’s consent agreement with the state). Ratings agencies have been vocal about Detroit’s troubles,…