The city of Detroit filed a plan today to emerge from the biggest municipal bankruptcy in US history and reverse a decades-long decline by slashing debt, improving services and cleaning up miles of blight.
Saddled with more than $18-billion in debt and a tax base depleted by decades of population loss and urban blight, the birthplace of the US auto industry has been so strapped for cash it can’t even keep the street lights on.
It filed for bankruptcy protection in July, the largest US city ever to do so.
The plan of adjustment, which was immediately attacked by creditors, must win approval from a federal judge and is expected to be subjected to months of court battles.
It was hailed, however, by Michigan Governor Rick Snyder as “a thoughtful, comprehensive blueprint directing the city back to solid financial ground, a crucial step toward a fully revitalised Detroit.”
The 120-page plan details a $1.5-billion investment over 10 years to improve essential services for the city’s 700,000 residents.
Up to a third of those funds would be used to deal with the estimated 80,000 abandoned buildings which litter the city.
Emergency manager Kevyn Orr acknowledged “there is still much work in front of all of us” after months of negotiations with creditors.
“We must move swiftly to emerge from bankruptcy so that the financial distress harming the City can end,” he said in a statement.
“We maintain that the plan provides the best path forward for all parties to resolve their respective issues and for Detroit to become once again a city in which people want to invest, live and work.”