Detroit bankruptcy eligibility ruling comes Tuesday morning
Judge Steven Rhodes to announce decision on whether city is eligible for Chapter 9 bankruptcy
Detroit’s future rests in the hands of one man: Judge Steven Rhodes.
Rhodes will announce Tuesday morning whether he has decided to approve Detroit’s request to file Chapter 9 bankruptcy.
"I would be willing to bet a lot of money that Judge Rhodes approves the petition and will keep jurisdiction over the whole case," said bankruptcy expert Mike Greiner.
Read more: Experts expect judge to rule Detroit is bankruptcy eligible
What that means is Detroit is eligible to file for Chapter 9 and everything -- whether it’s pensions or the potential of art being sold off from the DIA -- will be decided in his courtroom.
Special section: Detroit bankruptcy
Attorneys for Detroit’s unions have already asked the judge whether they can appeal his yet-to-be-announced ruling. They want to bypass lower courts and take it to the 6th Circuit Court of Appeals.
Experts say there are three options: Rhodes can deny the appeal, approve the appeal and still move the case forward or approve the appeal and hold off on moving the case forward.
Greiner believes Rhodes will move the case forward but may grant the appeal.
If the bankruptcy petition is approved, what’s next? It’s called a Plan of Adjustment. It will be submitted by Emergency Manager Kevyn Orr. Think of it as Orr’s roadmap to who gets paid what when it comes to creditors and where the funds will come from.
Orr has said he anticipates submitting the plan before the end of the year.