Emergency manager: Detroit won't pay $2.5B it owes

Forum adverts like this one are shown to any user who is not logged in. Join us by filling out a tiny 3 field form and you will get your own, free, dakka user account which gives a good range of benefits to you:

No adverts like this in the forums anymore.
Times and dates in your local timezone.
Full tracking of what you have read so you can skip to your first unread post, easily see what has changed since you last logged in, and easily see what is new at a glance.
Email notifications for threads you want to watch closely.
Being a part of the oldest wargaming community on the net.

If you are already a member then feel free to login now.

**MrMoustaffa**

chaos0xomega wrote:
Hmmm... detroit has lots of empty homes...
hmmm..... this country has big homeless problem....

hmmm.......

nope, should probably just bulldoze down most of it and only leave the downtown area intact.

You realize most of these homes in question aren't fit for rats to live in, let alone humans, right?

I've heard of efforts to get people to move back in, including those rumors of "$5,000 dollar homes", until I found out that apparently not only do you get the home, but all the debts that are attached to that property as well. Heck, I've seen homes as cheap as one dollar that have enough fire damage. You also have to take into account questions like "do I have running water here", "Is there electricity", and "is mad max going to drive through my living room tomorrow?".

There's a reason people haven't rushed up there to buy all that empty land. Well, reasons besides the fact that you'd be moving to Detroit.

I'm kind of wondering how long it will be until we see some sort of major incentive program in an attempt to get people to move back into the city. A kind of "Urban Reclamation" program if you will. Perhaps encouraging college students to move there with promises of a small home and a small chunk of cash to rebuild it, or perhaps some sort of tax benefit system. I'm not really educated on that kind of thing, so I have no idea how it would work, but it would be interesting to see happen. Maybe the unclaimed suburbs of Detroit will become the next wild west? If they had a really good incentive program set up I can't lie, I would have to take a look.

**djones520**

The construction of the new arena for the Red Wings might help a bit. The last major construction project like that in downtown Detroit was Comerica park, and that was about 15 years ago if I recall correctly.

There is also scuttlebutt that they might be trying to bring the Pistons back into Detroit as well, which could necessitate more construction, which would be a further boon for the city.

**purplefood**

So there's no traction on the whole 'Army Urban Warfare Training Ground Initiative' then?

**Jihadin**

**Ouze**

MrMoustaffa wrote:
[I'm kind of wondering how long it will be until we see some sort of major incentive program in an attempt to get people to move back into the city. A kind of "Urban Reclamation" program if you will. Perhaps encouraging college students to move there with promises of a small home and a small chunk of cash to rebuild it, or perhaps some sort of tax benefit system. I'm not really educated on that kind of thing, so I have no idea how it would work, but it would be interesting to see happen. Maybe the unclaimed suburbs of Detroit will become the next wild west? If they had a really good incentive program set up I can't lie, I would have to take a look.

I also am intrigued by the possibilities of a 21st century Homestead Act.

I have to think that there is a lot of opportunity with the right training, zoning, and so forth to build an IT infrastructure there with the appropriate tax credits. Maybe insource some of those jobs that we've been sending to India for the last 15 years.

Ultimately I don't think anything can happen until the city falls under federal receivership of some sort though; which is probably it's ultimate destiny (imo). It's probably going to flounder around for a while first though; which is a real shame.

**Jihadin**

I'm actually avoiding the urge to check HUD for houses in Detroit...and the new guide lines Obama wants to apply to HUD...actually I might be wrong on that or misunderstood...still...not sure I want to see the prices on HUD.....

**MrMoustaffa**

Jihadin wrote:
I'm actually avoiding the urge to check HUD for houses in Detroit...and the new guide lines Obama wants to apply to HUD...actually I might be wrong on that or misunderstood...still...not sure I want to see the prices on HUD.....

Like I said, first you'll see prices and go "holy crap, I can own that house for 500 bucks?".

Then you realize these houses have massive leans against them, no running water, no electricity, probable fire damage, may or may not be infested with crackheads, cockroaches, or rats, and all sorts of other goodies.

To be honest, most of these properties are probably worth more if you just demolished the house and started over with a vacant lot.

**Grey Templar**

It probably would be the best way of salvaging the place. Bulldoze the entire thing and start everything from bare earth.

Bury the old city beneath the foundations of the old.

**Jihadin**

The start of the Detroit Hive.....

**LordofHats**

Ouze wrote:
MrMoustaffa wrote:
[I'm kind of wondering how long it will be until we see some sort of major incentive program in an attempt to get people to move back into the city. A kind of "Urban Reclamation" program if you will. Perhaps encouraging college students to move there with promises of a small home and a small chunk of cash to rebuild it, or perhaps some sort of tax benefit system. I'm not really educated on that kind of thing, so I have no idea how it would work, but it would be interesting to see happen. Maybe the unclaimed suburbs of Detroit will become the next wild west? If they had a really good incentive program set up I can't lie, I would have to take a look.

I also am intrigued by the possibilities of a 21st century Homestead Act.

I have to think that there is a lot of opportunity with the right training, zoning, and so forth to build an IT infrastructure there with the appropriate tax credits. Maybe insource some of those jobs that we've been sending to India for the last 15 years.

Ultimately I don't think anything can happen until the city falls under federal receivership of some sort though; which is probably it's ultimate destiny (imo). It's probably going to flounder around for a while first though; which is a real shame.

It would be interesting. Detroit isn't the only city in the US with large sections of abandoned buildings. Phillie has that too and I know some smaller cities in NC and SC are like that and some places in Miami are starting to get like it too.

**djones520**

Grey Templar wrote:
It probably would be the best way of salvaging the place. Bulldoze the entire thing and start everything from bare earth.

Bury the old city beneath the foundations of the old.

100 million has been allocated to begin that.

http://www.freep.com/article/20130606/NEWS06/306060065/demolition-money-vacant-land-detroit

**Alfndrate**

If Detroit would give me housing on the cheap, and give me incentive to move there and help me find a job before I did so, I'd be willing to move there. I could still see the Cleveland Indians, the Browns, and with the changes to the Red Wings, I could see the Ottawa Senators play

.

**whembly**

:necro'ed:

Update:

Update, and it's official:

JUDGE: DETROIT ELIGIBLE FOR IMMEDIATE BANKRUPTCY PROTECTION
DETROIT TO REMAIN UNDER BANKRUPTCY COURT PROTECTION, JUDGE SAYS
As somewhat expected - though hoped against by many Detroit union workers - Judge Steven Rhodes appears to have confirmed Detroit is eligible for bankruptcy protection (after pointing out that the city's accounting was accurate and it is indeed insolvent) making this the largest ever muni bankruptcy.

JUDGE RHODES SAYS HE WILL ALLOW PENSION CUTS IN DETROIT'S BANKRUPTCY
DETROIT JUDGE: NOTHING SEPARATES PENSIONS FROM OTHER DEBT
The city will now begin working toward its next major move - the submission of a plan to re-adjust its more than $18 billion in debt - including significant haircuts for pension funds (possibly 16c on the dollar recovery) and bondholders. With Detroit as precedent, we can only imagine the torrent of other cities in trouble that will be willing to fold.

He did provide an "out" though:

RHODES WARNS THE CITY THAT JUST BECAUSE PENSION RIGHTS CAN BE IMPAIRED, DOESN'T MEAN HE WILL APPROVE A PLAN WITH STEEP CUTS
Via Bloomberg,

Before the bankruptcy, Orr proposed canceling $3.5 billion in future pension obligations and at least $1.4 billion in unsecured bonds. The debts would be replaced with a $2 billion note paying 1.5 percent interest.
But, of course:

Detroit must ask “what is necessary to invest to attract business?” Spiotto said in a phone interview. “If you don’t solve the systemic problem, you are just going to repeat it.”
Summary from Reuters:

Detroit is eligible for the biggest municipal bankruptcy in U.S. history because the city is broke and without Chapter 9 bankruptcy would continue on the path that has led it to insolvency, a federal judge ruled on Tuesday.

The judge also ruled that while the city did not negotiate in "good faith" with creditors, there were too many of them to make such negotiations practical.

Appeals are expected, but the ruling by U.S. Judge Steven Rhodes sets the stage for Detroit to file a plan of financial readjustment by March 1. The city's attorneys said they were not sure if the filing would occur before the end of the year.

The ruling came 25 days after the end of an eligibility trial during which Detroit's labor unions, retirees and pension funds argued against the city's July 18 bankruptcy filing.

**Grey Templar**

I think we could have an entire mini-series on Repo'ing the entire city

**Frazzled**

Grey Templar wrote:
I think we could have an entire mini-series on Repo'ing the entire city

I want a fire station and fire trucks.

**Ouze**

We should probably change the OP from "won't" to "can't".

I think the bankruptcy ruling was about right.

**Gentleman_Jellyfish**

Thanks, Obama

**whembly**

Gentleman_Jellyfish wrote:
Thanks, Obama

?

He did say he'd "refuse to let Detroit go bankrupt"... didn't he?

**Dreadclaw69**

whembly wrote:
Gentleman_Jellyfish wrote:
Thanks, Obama

?

He did say he'd "refuse to let Detroit go bankrupt"... didn't he?

I'm sure that wasn't another lie either

Maybe he meant to say "If you like your Detroit, you can keep it"

**Alfndrate**

Dreadclaw69 wrote:
whembly wrote:
Gentleman_Jellyfish wrote:
Thanks, Obama

?

He did say he'd "refuse to let Detroit go bankrupt"... didn't he?

I'm sure that wasn't another lie either Maybe he meant to say "If you like your Detroit, you can keep it"

I don't know of anyone that likes their Detroit... except maybe those that like their Detroit sports teams...

**mega_bassist**

All I want is to see a freaking ED-209. That's all I want.