The Michigan House on Thursday approved sweeping legislation that would send $194.8 million to Detroit in a bid to minimize pension cuts for retirees and help end the largest municipal bankruptcy case in U.S. history, Michigan Live reported yesterday. The 11-bill package, now headed to the Senate for consideration, would consummate a “grand bargain” brokered by bankruptcy mediators and require long-term financial oversight for the city, which has racked up massive debt. Philanthropic foundations and the Detroit Institute of Arts have pledged $366 million for the grand bargain in order to protect prized art from a potential fire sale, and two union groups this week agreed to make or facilitate "material contributions" for retiree health care. In addition to the money, the House package approved yesterday would attach several "strings" to the state's financial contribution, provisions designed to win over skeptical lawmakers and protect taxpayer investment in Detroit. A financial oversight commission modeled after a similar board in New York City would have broad authority to review and approve city contracts, collective bargaining agreements and budgets. The commission could go dormant if the city meets certain financial goals over a three-year period and could be dissolved if it is dormant for 10 straight years.
