DETROIT — Emergency manager Kevyn Orr on Friday laid out an extraordinary, complex and painful path back to solvency for the city of Detroit in a proposed plan to creditors.
It would spin off the city’s water department, reduce city-provided health care for retirees and immediately stop debt payments and then use that money to keep the city operating while reinvesting $1.5 billion over the next decade to boost crucial public services like police and fire, step up blight removal and transform an antiquated, failing city government.
The impact of the document Orr released publicly and to creditors in Friday’s historic meeting cannot be understated.
Orr and two top consultants to the city discussed a staggering amount of liabilities — as much as $20 billion — in a briefing just before they met with as many as 150 creditors called together in a bid to win an out-of-court settlement of the city’s financial disaster or, at least, a municipal bankruptcy proceeding in which most creditors agree to deals before a Chapter 9 petition is filed.
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