Detroit Files Largest Municipal Bankruptcy In History
July 18, 2013
Detroit has filed for bankruptcy, the AP’s Ken Thomas reports. The full filing can be found below.
“Right now, the City cannot meet its basic obligations to its citizens,” Gov. Rick Snyder, who signed off on the filing, said in the petition. He added, “Right now, the City cannot meet its obligations to creditors.”
The move proved inevitable after two municipal pension funds sued city emergency manager Kevyn Orr.
It’s the largest municipal bankruptcy in U.S. history, dwarfing Jefferson County, Ala.’s $3.1 billion sewage district restructuring.
In June 2012, the City of Stockton became the largest-ever city to file for bankruptcy, at the time.
The Motor City faces $20 billion of long-term liabilities. The Wall Street Journal’s Matt Dillon says those holding onto $11 billion in unsecured debt are basically staring into the abyss, facing the prospect of getting next to nothing from the city’s obligations.