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Federal court mediators said yesterday that law firms and consultants reached agreements with Detroit over fees that they charged the city for work on its historic bankruptcy, Reuters reported. The mediators said in a statement that the agreements, which were not disclosed, are subject to approval by Judge Steven Rhodes, who oversaw the city's bankruptcy, which ended on Wednesday. As of Oct. 24, fees and expenses totaled nearly $141 million, with law firm Jones Day submitting the biggest bill, totaling $52.3 million. The deals were reached "after intensive negotiating sessions over the past several weeks" involving representatives of the law firms and consultants, as well as the city's emergency manager, mayor, council and Michigan Governor Rick Snyder, the statement said.

The nation’s largest municipal bankruptcy ended yesterday, officials said, marking a turning point for a former industrial powerhouse that has struggled for decades with population loss, blighted property, high crime and poor city services, the Wall Street Journal reported today. After almost 21 months in office, Detroit Emergency Manager Kevyn Orr, who steered Detroit into a chapter 9 filing in July 2013, resigned on Tuesday saying that his job to restructure debt and help the city balance its books for the future had been accomplished. “It’s important for me to step back and return the city to the regular order,” Orr said yesterday. He said he would file legal paperwork by day’s end to usher the city out of bankruptcy court, save a few loose ends including mediation over professional fees from lawyers and consultants charged to the city. His legal team filed the order just before 3 p.m. The judge in the case is scheduled to hold a status hearing in the case on Monday to address any lingering legal issues.

Michigan Governor Rick Snyder's office said that Detroit’s municipal bankruptcy case will end today when the city's debt adjustment plan will take effect, Reuters reported yesterday. The city, which filed for bankruptcy in July 2013, won approval on Nov. 7 from a federal court judge for its plan to shed about $7 billion of its $18 billion in debt and obligations. In a letter, Snyder accepted Detroit Emergency Manager Kevyn Orr’s declaration that the city's financial emergency is over and that it was time for his job to end. Snyder appointed Orr, a former corporate bankruptcy attorney at law firm Jones Day, to run Detroit in March 2013. Orr's departure will restore complete control over the city to Mayor Mike Duggan and the city council, although a state-created oversight board is in place to review and approve financial matters. Detroit is expected to close deals to distribute bonds to settling creditors, including bond insurers, on the effective date. The city is also planning to borrow $275 million through Barclays Capital to retire $120 million of debt, pay settlements and fund restructuring initiatives.

Outgoing Detroit emergency manager Kevyn Orr told a state oversight board on Friday that he's prepared to ask a federal judge to make the city's exit from bankruptcy official next week, and that he'll resign, leaving the city with a one-time, $100 million surplus, The Detroit Free Press reported on Friday. Orr, speaking to the Financial Review Commission, which has had oversight of the city’s finances for at least 13 years, said that he intends to sign his final order as EM next week, "recommending to you and the governor that the financial emergency is completed, and I would resign." If accepted by Gov. Rick Snyder, that would fully restore government powers to Detroit's elected officials, except that the city will remain under the oversight of the review commission and must stay within the confines of its bankruptcy exit plan, which lays out goals for fiscal stability and reinvestment in critical city services over the next 10 years. Orr would present the order to Hon. Steven Rhodes, but Orr said that it is highly unlikely that the judge will reject the exit plan since he approved Detroit's bankruptcy adjustment plan last month. The date Orr selects will mark Detroit's official exit from the largest municipal bankruptcy in U.S. history, with the city shedding $7 billion of its $18 billion in debts and liabilities and instituting a plan to spend $1.4 billion on blight removal and improving city services over the next decade.

Detroit might not be ready to exit the biggest municipal bankruptcy in U.S. history until Dec. 15, Reuters reported on Friday. An attorney for the city said last month Detroit could potentially exit bankruptcy around Dec. 8-10 as it has incorporated its debt-adjustment plan into its budget. The plan was approved by a bankruptcy court judge on Nov. 7. Kevyn Orr, the city's state-appointed emergency manager, said that Detroit's two-year budget will eliminate a carryover deficit of about $58 million and incorporate a reserve fund totaling $62 million, or 5 percent of appropriations required under state law. The budget will also provide $49 million that could be tapped to fund restructuring initiatives in fiscal 2016.

In a sign of Detroit’s continuing challenges, the city’s schools, police stations, fire houses and other public buildings lost power yesterday after an aging underground cable failed, the Wall Street Journal reported today. Within 90 minutes, the Detroit Public Lighting Department with help from DTE Energy Co. began restoring service, and all affected buildings had access to power by yesterday evening, the city said. It also served as a reminder of the city’s problems, even as it nears an exit from chapter 9 protection. “The bankruptcy order doesn’t solve the decades of neglect in our infrastructure, and that is what we saw today,” said Mayor Mike Duggan.

The attorneys and financial consultants who represented Detroit's two pension funds during the city's bankruptcy will have their fees subjected to the same scrutiny as other highly paid professionals, the Detroit News reported on Friday. Bankruptcy Judge Steven Rhodes ruled on Wednesday that the Police and Fire Retirement System and General Retirement System should be subjected to the court's review of costs associated with litigating the largest bankruptcy in U.S. history. Robert Gordon, an attorney for the pension funds, argued in court on Monday that they should not be subject to fee examiner Robert Fishman’s ongoing reviews because Detroit taxpayers are not directly footing their legal bills. Judge Rhodes disagreed, while acknowledging there's no legal precedent for having a creditor's legal fees subject to court review in a chapter 9 municipal bankruptcy.

An attorney for Detroit said that the city is eying a date between Dec. 8 and 10 for its debt adjustment plan to take effect, allowing the city to exit the biggest-ever municipal bankruptcy, Reuters reported yesterday. Heather Lennox, Detroit's attorney with law firm Jones Day, told U.S. Bankruptcy Court Judge Steven Rhodes that the city expects to complete a budget that incorporates the plan during the first week of December, clearing the way for the completion of financing to fund key creditor settlements. Lennox said the remaining issues with the settlements should be resolved this week, including state of Michigan approval for development agreements with bond insurers Syncora Guarantee Inc. and Financial Guaranty Insurance Co. Both companies, which guaranteed payments on Detroit bonds, were given options to develop city property as part of their settlements. The insurers will share in $88.43 million of taxable limited-tax general obligation bonds that Detroit plans to pay off over 12 years with parking revenue. Judge Rhodes, who confirmed the city's plan on Nov. 7, did not set an effective date at Monday's hearing.

A federal judge yesterday allowed a lawsuit challenging the constitutionality of Michigan's emergency manager law to move forward on grounds that it might discriminate on the basis of race, Reuters reported yesterday. U.S. District Court Judge George Caram Steeh dismissed other counts in the lawsuit against the law, which allows the state to intervene in fiscally troubled local governments. He ruled that the case brought by affected residents and a public labor union will proceed on an allegation that the 2012 law discriminates against African-American residents in cities run by an emergency manager. He added that allowing the lawsuit to move forward would not impact Detroit, which was assigned an emergency manager and is poised to exit the biggest-ever municipal bankruptcy by year-end after a federal bankruptcy judge confirmed the city's debt adjustment plan on Nov. 7. The lawsuit contended that 52 percent of Michigan's black population resides in cities with a state-appointed emergency manager or some other form of state oversight, while only about 2 percent of white residents are affected in the same way.

Bankruptcy Judge Steven Rhodes said yesterday that implementation of Detroit's plan to exit the biggest-ever U.S. municipal bankruptcy should be on the fast track, Reuters reported yesterday. "The city needs to begin implementing this plan immediately," Judge Rhodes said at a hearing. He waived a 14-day automatic stay on the plan of adjustment, but did not decide the official date for the city's emergence from bankruptcy. Judge Rhodes said he will conduct a hearing on Nov. 24 on the matter. Meanwhile, a nine-member commission charged with overseeing Detroit's post-bankruptcy financial recovery reviewed fiscal deadlines for the city at its initial meeting. Judge Rhodes on Friday ruled that Detroit's plan for cutting $7 billion of its $18 billion of debt was fair to creditors and feasible for the city to carry out.