Former Detroit emergency manager Kevyn Orr today defended his decision not to push the city into 401(k)-style pension plans during the city's chapter 9 bankruptcy, the Detroit Free Press reported today. Orr said that he's comfortable with his decision not to eliminate the city's defined-benefit plan, which guarantees a certain level of post-retirement benefits to pensioners. Instead, the city negotiated a new formula that requires some union members to contribute to their pensions.
In related news, Detroit Mayor Mike Duggan presented a fiscal 2016 budget on Tuesday to the city council, warning that any changes in the spending plan would need approval from the post-bankruptcy city's oversight board, Reuters reported yesterday. Detroit exited its 17-month bankruptcy in December. A financial review commission, created under Michigan law, maintains control over Detroit's spending until the city pays its bills and balances its budget for three straight years. "Everything that we do is focused on how fast we can return self-determination to the city of Detroit," Duggan told the council, saying the earliest that could happen is 2018.
