While Detroit struggles with the effects of its bankruptcy, leading thinkers gathered at Wayne State University to discuss solutions. The conference, Detroit Bankruptcy & Beyond: Organizing for Change in Distressed Cities, was held last week, and Praxia Partners’ founder and CEO Joe Recchie proposed an innovative idea that could be applied to help Detroit’s schools, parks, or pensioners facing cuts to their benefits.
john powell, Director of UC Berkley’s Haas Institute for a Fair and Inclusive Society called the idea a “game-changer.”
Here’s how the plan works:
- Instead of a massive corporation taking over Detroit’s extensive water and sewer system, it should be transferred to an entity benefiting pensioners or Detroit’s schools or parks systems, etc.
- Break utility contracts.
- Raise rates in accordance with national trends.
- Detroit can then honor its obligations to its public servants– and its future workers.
You can read the full proposal.
Detroit is an impoverished and highly segregated city, and its water and sewer systems have benefited Michiganders for decades. Now those communities can help Detroit recover.
This week, pension representatives have reached a tentative deal. The Free Press writes:
Negotiators for Detroit pension boards agreed late Tuesday to retiree benefit cuts that were dramatically lower than initially proposed, marking a watershed moment that could help resolve Detroit’s historic Chapter 9 bankruptcy and position the city to start reinvesting in services, sources familiar with the deal said.
The deal would require civilian retirees to accept 4.5% cuts to their monthly pension checks and the elimination of cost-of-living adjustment (COLA) increases, while police and fire retirees get no cuts to monthly checks but absorb a reduction in COLA increases, sources said.
Pension board trustees must still sign off on the deal, and a U.S. government-appointed committee officially appointed to represent Detroit retirees is still weighing whether to support the city’s proposal.
We believe there is a more equitable and sustainable solution that would secure future funding for pensions and strengthen the city’s workforce. They earned their full benefits and deserve COLA adjustments.