Detroit revealed its historic plan to emerge from under $18 billion in debt Friday, laying the groundwork for what’s expected to be a long, bitter battle with creditors, retirees and bondholders over the biggest municipal bankruptcy ever.
The 120-page ‘plan of adjustment’ could change radically as negotiations with pension funds, creditors and others move forward. It must still be approved by U.S. Bankruptcy Judge Steven Rhodes. According to The Associated Press, an early draft of the plan called for city pensioners to receive $4.3 billion in payments and bondholders about $1.1 billion during the next 40 years.
That draft also detailed plans to help pensioners keep more of what they are owed by using state and private funds to protect against the sale of city-owned art at the Detroit Institute of Arts, the AP said.