“Detroit on Thursday became the largest city in U.S. history to file for bankruptcy, as the state-appointed emergency manager filed for Chapter 9 protection.
Kevyn Orr, a bankruptcy expert, was hired by the state in March to lead Detroit out of a fiscal free-fall and made the filing Thursday in federal bankruptcy court.
A number of factors — most notably steep population and tax base falls — have been blamed on Detroit’s tumble toward insolvency. Detroit lost a quarter-million residents between 2000 and 2010. A population that in the 1950s reached 1.8 million is struggling to stay about 700,000. Much of the middle-class and scores of businesses also have fled Detroit, taking their tax dollars with them.
In recent months, the city has relied on state-backed bond money to meet payroll for its approximately 10,000 employees.
Orr was unable to convince a host of creditors, the city’s union and pension boards to take pennies on the dollar to help facilitate the city’s massive financial restructuring. If the the bankruptcy filing is approved, city assets could be liquidated to satisfy demands for payment.”
Here is a link to the article: http://finance.yahoo.com/news/detroit-emergency-manager-files-bankruptcy-201454103.html;_ylt=AnDRJU3NMvi_o_bVOWuFiyiiuYdG;_ylu=X3oDMTN1NzJyNjhtBG1pdANGaW5hbmNlIEZQIE1lZ2F0cm9uIDIEcGtnAzRmOTE3NTBlLTFjOTItM2U4Mi1hMmM5LTNkMDIzMjI2ZGRjYwRwb3MDMQRzZWMDbWVnYXRyb24EdmVyAzUwOTA1YzQwLWVmZWEtMTFlMi1iZmFiLWJlZWQ2ODUwMGYyNw–;_ylg=X3oDMTFkcW51ZGliBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDBHBzdGNhdANob21lBHB0A3BtaA–;_ylv=3