DETROIT (AP) — The city of Detroit made its final argument Monday to get out of bankruptcy, saying creative deals with creditors and other key factors have put it in position to scrub its books less than 16 months after filing the largest public case in U.S. history.
“The end really is in sight,” attorney Bruce Bennett said at the start of his closing remarks.
Judge Steven Rhodes will decide by next week whether Detroit’s bankruptcy plan is fair and feasible. It eliminates $7 billion in debt, cuts general pensions by 4.5 percent, pledges $1.7 billion for service improvements and prevents the sale of valuable art.
Detroit, which has lost 27 percent of its population since 2000, can’t afford to raise taxes to get more revenue, especially from poor residents, Bennett said.
“It’s self-defeating behavior. … No one would come here. They would look at the tax assessments and say, this will never end,” he said.
Attorneys for the state of Michigan, retirees and pension funds also are expected to make closing remarks. Bond insurers with more than $1 billion at risk fought the city during much of the trial, but now are on the sidelines after settling for cash, real estate and long-term leases on certain assets.
The city can’t be forced to get rid of assets to get out of bankruptcy, Bennett said, but the deals brought peace and require financial companies to invest in the city’s future.
Detroit filed for Chapter 9 bankruptcy protection in July 2013, becoming the largest U.S. city to ever do so.
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