Bankruptcy Solutions Emerge For Detroit Through Police Union Agreement

As Detroit works to recover from filing for Chapter 9 bankruptcy, city officials have been negotiating closely with the police union. As a major labor issue lingering over the city, Detroit has come to a temporary contract agreement, to create a new “plan of adjustment.”

This new deal comes directly from The Detroit Police Officers Union to work on reinstating wages, health care benefits, and pensions. In order to ensure the positive vote from the police union, Detroit has agreed to look at more long-term solutions, such as a five-year plan and deal for the city’s police force. This agreement came close to Detroit’s vote on the new bankruptcy blueprints.

Additionally, this new agreement also ensure that those receiving pensions will also approve this deal, to help motivate Detroit out of bankruptcy. Gerald Rosen, head bankruptcy mediator, explained that negotiations were intense and lasted nearly a year, in order for all sides to be heard. The only union that is still unbalanced in a decision is the Detroit firefighters union.

The importance of finding a common ground with unions, prior to the bankruptcy trail, is to ensure that union worker’s requests are taken into consideration. Rosen added that with the new contract between the city’s police, there are “Only a few remaining disputes to be addressed between the City and its creditors.”

Prior to this agreement, Detroit police had refused to assist with any movement towards the restructuring of Detroit. The initial plan had allowed retired police officials to start including a reduction in their cost-of-living adjustment, through their monthly pension checks. While initially the retired police officers were on board with Kevyn Orr’s (Detroit’s emergency manager) plan to rebuild the city, they held out for a better deal. Retirees and anyone involved with pensions for the unions have been encouraged to vote yes on the new deal with the city.

The funds to help those who have suffered from the bankruptcy with their pensions has greatly increased. The state has put forth $195 million to these funds, with additional money coming from the following: $366 million from nonprofits and $100 million from the Detroit Institute of Arts.

In order for this deal to be passed, over half of the retired pension votes need to be a resounding yes. This includes civilians invested in pensions, and uniformed retirees.