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The Detroit Bankruptcy

The Detroit Bankruptcy
The Detroit Bankruptcy The City of Detroit’s bankruptcy was driven by a severe decline in revenues (and, importantly, not an increase in obligations to fund pensions). Depopulation and long-term unemployment caused Detroit’s property and income tax revenues to plummet. The state of Michigan exacerbated the problems by slashing revenue it shared with the city. The city’s overall expenses have declined over the last five years, although its financial expenses have increased. In addition, Wall Street sold risky financial instruments to the city, which now threaten the resolution of this crisis. The Shortfall Detroit’s emergency manager, Kevyn Orr, asserts that the city is bankrupt because it has $18 billion in long-term debt. Cash flow crisis. In a corporate bankruptcy, the judge takes stock of a company’s total assets and liabilities because the company can be liquidated and all its assets sold to pay down its debts. Total outstanding debt. Revenue Tax revenue. State revenue sharing. Expenses

The Rise and Fall of Detroit’s Middle Class In 1973, Ron and Loretta Martin and their three sons moved into the yellow-brick Colonial across the street from my childhood home, on Detroit’s west side. My father greeted them warmly, despite the fact that most of our neighbors saw them as blockbusters, part of a nefarious conspiracy by civil-rights groups to force integration and break up tight-knit white enclaves. The Martins were one of the first black families on our block. It took a lot of courage to be pioneers, those black families who crossed the city’s racial frontier. Ron and Loretta were pioneers in another way. It was not always this way. But by the time the Martins moved in, those blue-collar jobs were disappearing. Public employment, of course, did not come cheaply. Between 1990 and 2013, Detroit reduced its municipal workforce by nearly half to help make ends meet. A few decades ago, Detroit barely survived the collapse of the auto industry. Thomas J. Photograph by Bill Pugliano/Getty

Eight Mile Road | Detroit Historical Society Eight Mile Road was originally a dirt road that was designated as M-102 in 1928. Gradually, the road was widened and extended. Currently it exists in most areas as an eight-lane road, spanning more than 20 miles across metropolitan Detroit. Its more popular name is derived from the Detroit area’s Mile Road System. This system helps to identify streets running east-west throughout the region, beginning at the downtown intersection of Woodward and Michigan Avenue near the Detroit River. Hence, Eight Mile is approximately eight miles from the shore. On a map, Eight Mile separates Wayne and Washtenaw counties from Macomb, Oakland, and Livingston, and Macomb counties. Eight Mile Road also played a role in one of the most notable controversies of famed Detroit Mayor Coleman A. Along its most impoverished sections, Eight Mile Road has, for several decades, been a destitute, dangerous strip of suffering businesses and broken windows. View all items related to Eight Mile Road

Why isn't everyone buying cheap houses in Detroit as an investment? - Quora Detroit Arcadia | Essay | Rebecca Solnit Until recently there was a frieze around the lobby of the Hotel Pontchartrain in downtown Detroit, a naively charming painting of a forested lakefront landscape with Indians peeping out from behind the trees. The hotel was built on the site of Fort Pontchartrain du Détroit, the old French garrison that three hundred years ago held a hundred or so pioneer families inside its walls while several thousand Ottawas and Hurons and Potawatomis went about their business outside, but the frieze evoked an era before even that rude structure was built in the lush woodlands of the place that was not yet Michigan or the United States. Scraped clear by glaciers during the last ice age, the landscape the French invaded was young, soggy, and densely forested. Fort Pontchartrain was never meant to be the center of a broad European settlement. It was a trading post, a garrison, and a strategic site in the scramble between the British and the French to dominate the North American interior.

Most Detroit Families Can't Afford Their Basic Needs: Report Two-thirds of Detroiters can’t afford basic needs like housing and health care, even when family members are employed, according to a new report. On Sunday, the United Way released a study that found 40 percent of Michigan households, and 67 percent of Detroit families, are either under the poverty line or what it identifies as “ALICE” — asset-limited, income-constrained, employed. Yes, Detroit’s poverty rate is 38 percent, but the United Way study looks at the cost of living — factoring in housing, child care, food, transportation and health care — compared to income by county to identify families that are above the federal poverty line but still struggling. “There’s this whole other group of people — could be you or me — (who are) one failed transmission away from going over the cliff to poverty,” Nancy Rosso, executive director of the Livingston County United Way, told the Livingston Daily. Read the full report here. Most Stressful Jobs Of 2014 10. Getty Images

Eight miles of murder Even by the low standards of Eight Mile Road, the Triple C bar was a seedy place to die. It is a squat one-storey building, windowless and dingy. The only hint at the nightclub inside is three white 'C's tacked to a dirty wall. It was here last week that local Detroit rapper 'Proof' died in a gun battle. It was a fight that ended another young black life in one of America's toughest cities. To many, Eight Mile is a familiar name - made famous by the semi-autobiographical movie of the same name by rapper Eminem. But unlike the white rapper Eminem, the black Proof - real name DeShaun Holton - showed that most people do not escape Eight Mile. But Eight Mile means far more than another dead Detroit rapper, far more than one successful movie. Walking from one side of Eight Mile Road to the other is a jarring experience. In Detroit the unemployment rate is 14.1 per cent, more than double the national average. That decision goes to the core of the problem: race. Violence in rap

Detroit To Officially Exit Historic Bankruptcy DETROIT, Dec 10 (Reuters) - Detroit will officially exit the biggest-ever U.S. municipal bankruptcy later on Wednesday, officials said, allowing Michigan’s largest city to start a new chapter with a lighter debt load. The city, which filed for bankruptcy in July 2013, will shed about $7 billion of its $18 billion of debt and obligations. “We’re going to start fresh tomorrow and do the best we can to deliver the kind of services people deserve,” said Mayor Mike Duggan. Once a symbol of U.S. industrial might, Detroit fell on hard times after decades of population loss, rampant debt and financial mismanagement left it struggling to provide basic services to residents. Later on Wednesday, payments to city creditors will be triggered under a debt adjustment plan confirmed by a U.S. Most of the settlements with major creditors, including Detroit’s pension funds and bondholders, will be paid with a distribution of about $720 million of bonds.

Fixing Detroit’s 
Broken School System: Improve accountability 
and oversight for district and charter schools Detroit is a classic story of a once-thriving city that has lost its employment base, its upper and middle classes, and much of its hope for the future. The city has been on a long, slow decline for decades. It’s difficult to convey the postapocalyptic nature of Detroit. Miles upon miles of abandoned houses are in piles of rot and ashes. Unemployment, violent crime, and decades of underinvestment have led to a near-complete breakdown of civic infrastructure: the roads are terrible, the police are understaffed, and there is a deeply insufficient social safety net. There are new federal funds and private investment being directed to Detroit’s renewal. In January 2014, as part of a multicity study, researchers from the Center on Reinventing Public Education (CRPE) met with a dozen parents in Detroit to learn about their experiences with education in the city. Ms. Today, Detroit is a “high-choice” city. School Choice with Few Options The dearth of high-quality options is evident to parents.

After bankruptcy, few options for Detroit to grow revenue Slash costs, fix the balance sheet and take money that was once tied to debts and spend it on police, fire and other city services. That's the premise of Detroit's bankruptcy: short-term pain for long-term benefit, and cuts for Detroit's creditors, but better outcomes for residents. But of the $1.7 billion that Detroit's post-bankruptcy plan is expected to generate, only about $900 million comes from restructuring the city's debts. About $483 million comes from projected new revenues, $358 million from cost savings. "We don't have $1.7 billion in the bank," said former Detroit emergency manager Kevyn Orr, who led the city through bankruptcy. "We think we've made our estimates reasonable." Simple enough on paper, but in reality? In short, it's not that easy. "It's very fragile," said Sheila Cockrel, a 16-year veteran of the Detroit City Council who is now the president of Crossroads Consulting. Why is it different now? Like a lot of Detroit's problems, it sounds simple. Where cash comes from

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