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Detroit files for Chapter 9 municipal bankruptcy

Detroit becomes largest city in U.S. history to file for bankruptcy

Author: Dave Bartkowiak Jr. , Online News Editor, @DaveBartko, dbartkowiak@wdiv.com
Published On: Jul 18 2013 04:02:14 PM EDT   Updated On: Jul 18 2013 07:29:47 PM EDT

Detroit files for Chapter 9 bankruptcy

LATE THIS AFTERNOON, THE CITY OF DETROIT FILED CHAPTER 9 BANKRUPTCY! Ruth: LOCAL 4 WAS THE FIRST TO BREAK THIS NEWS, BOTH ON AIR HERE ON LOCAL 4 AND ALSO ON OUR WEBSITE, CLICKONDETROIT.COM. DETROIT IS NOW THE LARGEST CITY IN THE UNITED STATES TO FILE FOR CHAPTER 9 BANKRUPTCY. Devin: AND EVEN THOUGH MANY HAVE SEEN THIS DAY COMING AND SURE IT WOULD HAPPEN, NONETHELESS, IT'S FELT VERY DRAMATIC FOR IT FINALLY TO BE FILED. WE HAVE EVERY ANGLE COVERED AND WILL START OFF AT 5:00 WITH MARA MACDONALD. WE'VE GOT THE FIRST WORD THAT IT'S BEEN FILED. Mara: HOLD ON JUST A SECOND. I JUST HUSTLED DOWN FROM THE 11th FLOOR OF CITY HALL AND I'M HAVING A SMALL PROBLEM WITH MY EAR PIECE. HERE'S THE SITUATION: FILING WENT DOWN ELECTRONICALLY SHORTLY BEFORE 4:00. WE BROKE IN, LETTING EVERYONE KNOW ABOUT THE FILING. AS OF RIGHT NOW, THE MAYOR SAYS THERE WILL BE NO ON-CAMERA INTERVIEW TODAY. WE'RE EXPECTING A STATEMENT OUT OF BING'S OFFICE SHORTLY. SPOKE TO HIS COMMUNICATIONS DIRECTOR PROBABLY 7 MINUTES AGO. THEY SAID THE STATEMENT WOULD BE COMING UP SHORTLY. WAITING ON KEVYN ORR'S SPOKESMAN. WE'VE BEEN TOLD THAT ORR IS NOT IN THE BUILDING HERE IN CITY HALL, WAITING FOR A COMMENT OUT OF KEVYN ORR AT THIS HOUR. NO ONE SHOULD BE SURPRISED THAT THIS FILING CAME. MAYBE SURPRISED THAT IT CAME AS QUICKLY AS IT DID TODAY BUT SHOULDN'T BE SURPRISED. WE'VE BEEN REPORTING SINCE LAST WEEK THAT IT WAS IMMINENT. SOURCES HAD BEEN BLOWING UP MY PHONE SINCE PROBABLY 9:00 THIS MORNING, TELLING ME THAT -- I MEAN, THE POLITICAL CLASS IN OAKLAND AND WAYNE WAS BUZZING THAT THIS WAS GOING TO HAPPEN, BUT THEY THOUGHT IT WAS GOING TO HAPPEN TOMORROW. IN ADDITION, SOURCES IN LANSING BUZZING AGAIN. WORD ON THE STREET IS THE FILING WAS COMING. NOT JUST THAT THE GOVERNOR HAD SIGNED OFF ON IT BUT THE ACTUAL FILING WAS COMING DOWN, BUT COMING DOWN TOMORROW. LATE THIS AFTERNOON, TOP-LEVEL SOURCES CONFIRMING FOR US THAT INDEED THE FILING HAD COME DOWN AND WAS IN POSSESSION OF THE FEDERAL BANKRUPTCY COURT. AS OF RIGHT NOW, STANDING BY LIVE AT CITY HALL, WAITING TO GET A REACTION FROM MAYOR DAVE BING AND WAITING TO HEAR WHAT, IF ANYTHING, EMERGENCY MANAGER KEVYN ORR WILL HAVE TO SAY. Devin: FOR MOST OF THE DAY, WE HEARD TOMORROW WOULD BE THE EARLIEST THIS WOULD HAPPEN. SOMETHING SEEMED TO ACCELERATE THINGS THIS AFTERNOON, DIDN'T IT? Mara: I THINK IT WAS A TWO-FER. THE PENSION BOARD, BOTH OF DETROIT'S PENSION BOARDS FILING A LAWSUIT AGAINST THE GOVERNOR AND THE EM LAST NIGHT WAS THE THING THAT KICKED THE LEVER HERE. THAT LAWSUIT CLAIMING THAT ORR AND THE GOVERNOR DID NOT HAVE THE AUTHORITY TO PULL A CHAPTER 9 FILING. I THINK THAT KICKED THINGS INTO GEAR HERE. ORR SAID FROM DAY ONE, IF PEOPLE AREN'T GOING TO COME TO THE TABLE AND THERE'S NO NEGOTIATION, THEN HE DOESN'T HAVE A CHOICE AND HE'S NOT AFRAID TO PULL THE CHAPTER 9 LEVER. AND I THINK THAT, AT THIS POINT IS, WHAT WE SEE. WHY IT ACCELERATED TO THE POINT THAT IT DID TODAY, PROBABLY EXTERNAL FORCES AND EXTERNAL PRESSURE. I MEAN, DEVIN, RUTH, YOU KNOW HOW THINGS GET WHEN SOMETHING OF THIS MAGNITUDE IS GOING ON. IT'S LIKE AN INCREDIBLE BUZZ THAT KEEPS BUILDING, AND FOR WHATEVER REASON, THEY DECIDED TO MAKE IT HAPPEN LATE THIS AFTERNOON. Ruth: ACTUALLY, THAT LAWSUIT FILING MAY HAVE HAD A TOTALLY OPPOSITE EFFECT. Devin: THAT WAS THE CENTRAL

DETROIT -

The city of Detroit has filed for Chapter 9 municipal bankruptcy.

View document: Detroit bankruptcy filing

Read: Gov. Rick Snyder's statement on Detroit bankruptcy

The city has become the largest in U.S. history to file for bankruptcy protection.

Read: Chapter 9 bankruptcy: What is it?

Detroit Emergency Manager Kevyn Orr officially made the filing on Thursday afternoon. Michigan Gov. Rick Snyder had to authorize the filing. Local 4 spoke with the governor Thursday evening.

"This was a very difficult and painful decision but if you look at it there is no other viable option," Snyder said. "People have been trying to get a resolution in good faith for some time now ... many people may say this is the lowest point in Detroit's history but if we weren't to do this, the way I view it, Detroit would continue going downhill."

Watch: Gov. Snyder explains why he authorized Detroit bankruptcy filing

Leaders at Detroit City Hall were reacting positively to the news, saying the city is going to be OK. Council Pro Tem Andre Spivey said councilmembers were not shocked. They have been waiting for this to happen but they weren't sure what day it would drop.

"I wish we could have had more time for Mr. Orr to negotiate with our employees, our unions, our retirees and our creditors and bondholders. But, this is the decision (Orr) felt he had to make," said Spivey. "But through all of this I want to reassure the citizens that we will still have a city to operate. Things won't shut down right now. Police, fire, DPS, all of our services continue to go forward."

Kevyn Orr joins Mayor Bing in bankruptcy press conference

Uncut: Bing, Orr presser on bankruptcy filing

Detroit Mayor Dave Bing held a press conference Thursday evening to offer his reaction to the filing. He later was joined by Orr who gave a brief statement and addressed citizens. Both Bing and Orr then took questions.

"This is a very, very difficult day for me, as I am sure it is for a lot of citizens here in the city of Detroit," Bing said. "I really didn't want to go in this direction, but now that we're here we have to make the best of it."

Orr said after weeks of negotiations and talks he and his team decided it was time to file for bankruptcy. He said Detroit residents won't see a change in services and paychecks will still be received.

"I'd like to say this to the citizens and residents of the city, to reassure them that it is business in the ordinary course ... nothing changes from the standpoint of the ordinary citizen," said Orr.

Read: Reaction to Detroit's bankruptcy filing

Complete coverage: Detroit Bankruptcy section

Social media reacts to Detroit bankruptcy

#DetroitBankrupt becomes trending topic on Twitter

Published On: Jul 18 2013 04:41:10 PM EDT   Updated On: Jul 18 2013 04:44:09 PM EDT
DETROIT -

Twitter was abuzz Thursday afternoon after it was announced Detroit filed for Chapter 9 municipal bankruptcy.

The city has become the largest in U.S. history to file for bankruptcy protection.

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