A federal judge in Detroit is expected to hear closing arguments starting today in the trial concerning the city’s proposed restructuring plan to trim $7 billion from its $18 billion in long-term obligations, The Wall Street Journal reported yesterday. Hon. Steven W. Rhodes is expected to rule the week of Nov. 3 on whether Detroit’s complex debt-cutting plan is feasible in helping the city fix its balance sheet as well as generally equitable to its thousands of creditors. Detroit is on the verge of a mostly amicable end to its historic bankruptcy case, with its largest holdout creditor unveiling a deal earlier this month to stop fighting and instead take a major stake in the city’s revival. Under the latest settlement, the city would knock down the soon-to-be vacant Joe Louis Arena, which will make way for redevelopment led by Financial Guaranty Insurance Co. The latest deal effectively would turn the bond insurer, which had once argued that the city’s debt-cutting plan was unworkable, into an ally. FGIC had also pushed for Detroit to consider selling its famed art collection to help pay off its debts.
