Media Information

PRESS RELEASE January 8, 2015

For immediate release: Contact: 313-649-7018
APPEAL OF DETROIT BANKRUPTCY ACCEPTED IN U.S. DISTRICT COURT
Press conference Thurs. Jan. 8. 2014 @ 10 A.M.
Nandi’s Knowledge Café, 12511 Woodward, Highland Park

Detroit—Detroit active and retired workers, residents, and many others, have appealed U.S.
Bankruptcy Judge Steven Rhodes’ confirmation of the bankruptcy plan of adjustment to the
U.S. District Court. The appeal (Case No. 2:14−cv−14920−BAF−RSW) was accepted Dec. 30, 2014, with U.S. District Court Judge Bernard Friedman and Magistrate Judge R. Steven Whalen presiding. “Judge Steven Rhodes’ decision to impair our pensions and health benefits, and disregard the State of Michigan Constitution has forced us to appeal the confirmation of the Plan of Adjustment,” said Bill Davis, President of the Detroit Active and Retired Employees Association (DAREA). “We realize that these are uncharted waters, but we believe this decision must be challenged to prevent further attacks on us and to protect the generations to come.” He added that the bankruptcy is an attack on a predominantly African-American workforce, and the nation’s largest Black-majority city. DAREA was formed by rank-and-file Detroit retirees, active employees, and concerned citizens. In addition to cutbacks of city jobs, pension benefits, wages, and health care, it strips Detroit of virtually every asset, including the Detroit Water and Sewerage Department, the third largest in the country.

Even former Detroit Emergency Manager Kevyn Orr said at a press conference after the confirmation that the bankruptcy originated with Michigan Governor Snyder, not Detroiters, beginning in 2010. It resulted from dictatorial, unlawful, premeditated actions by state government, under Public Act 436. The constitutionality of that act under the 14th Amendment, which guarantees “equal protection under the law,” is currently being challenged in the court of U.S. District Judge George Caram Steeh. The figure of a 4.5 percent reduction to retirees’ pensions cited by the media is false. Retirees will be cut far more than that because their annuities are being slashed 15 percent plus 6.75 interest. DAREA estimates that pensions will be reduced from 17 percent (no annuity claw-back) to 32 percent (with claw-back), annually. This increases to over an estimated 50 percent when you consider the cost of health care and prescription cost eliminated. The income stabilization plan for retirees over 60 whose income is less than 105 percent of the poverty level is welfare and does not address the thousands of workers and retirees under 60, who are suffering the severest cuts, having lost their health care benefits as well as jobs, wages, and huge portions of their pension checks. Pension benefits were “earned” and should be restored as taken from all active and retired employees. DAREA spokespersons and numerous retirees and city workers will be available to answer questions at the conference.