Congressman Chaka Fattah ( Dem - Pa ) calls for Washington bailout of the City of Detroit ... White House we're monitoring but solve your problems Detroit........

Congressman Asks Obama For "Immediate Support" With Detroit Bankruptcy

Submitted by Tyler Durden on 07/18/2013 20:12 -0400

• Detroit
 
• Michigan
 
• President Obama
 
• White House

Four years ago he bailed out the city's automotive industry, and a whole lot of union votes. Moments ago, Obama was just called in again, this time to bail out the entire city. "Representative Chaka Fattah (D-PA), a leader of the Congressional Urban
Caucus, sent a letter to President Obama today calling on the
Administration to lend a helping hand to Detroit, Michigan following the news that the city has filed for bankruptcy." So will the president play favorites? Or will the municipal bailout begin where the private sector bailout ended? And since bailouts tend to be contagious, if and when Obama does "lend a helping hand" to Detroit, paid for by all US taxpayers, which city, or rather cities, will demand the same treatment? And how long until other people's money finally runs out?

From PR Newswire

Urban Caucus Leader Calls on Federal Government to Support Detroit

Congressman Fattah asks the President to act immediately to help the City of Detroit.

Representative Chaka Fattah (D-PA), a leader of the Congressional Urban Caucus, sent a letter to President Obama today calling on the Administration to lend a helping hand to Detroit, Michigan following the news that the city has filed for bankruptcy.

In the correspondence, Fattah requests the Administration intercede to make certain that Detroit's future is secure and hopeful. He asks the President to bring together members of his cabinet and members of the White House Council on Strong Cities, Strong Communities to work together to analyze Detroit's fiscal situation and intervene on the city's behalf.

Fattah said in his letter, "I understand the important role cities play in the economic vitality of metropolitan regions and our nation as a whole. Our cities serve as economic engines leading to innovations, job creation and growth. Moreover, cities like Detroit are strategically aligned, within their respective regions, to attract economic opportunities for their surrounding areas. As such, we must do all we can to protect these cities and work toward their prosperity."

Fattah stands ready to work with John Conyers and the rest of the Michigan delegation on this important issue.

Check to the President , check back to Detroit ! 

http://www.reuters.com/article/2013/07/18/us-usa-detroit-obama-idUSBRE96H1CT20130718

(Reuters) - President Barack Obama and his senior advisers are closely monitoring the situation in Detroit after the city filed for bankruptcy on Thursday, the White House said.

"While leaders on the ground in Michigan and the city's creditors understand that they must find a solution to Detroit's serious financial challenge, we remain committed to continuing our strong partnership with Detroit as it works to recover and revitalize and maintain its status as one of America's great cities," said Amy Brundage, a White House spokeswoman.

What happens next , all things being equal......

12 Things That Will Happen Next In Detroit's Bankruptcy

Submitted by Tyler Durden on 07/18/2013 18:45 -0400

• Bankruptcy Code
 
• Creditors
 
• Detroit
 
• Michigan
 
• Ohio

From Detroit Free Press:

Here’s what happens next:

• The city filed a Chapter 9 bankruptcy petition today in the U.S. Eastern District Court of Michigan. The filing includes additional information on the city’s financial outlook and could include details about the city’s plan to cut costs, such as potential layoffs and department consolidation, said Ken Schneider, a bankruptcy attorney with Detroit-based Schneider Miller PC.
• Alice Batchelder, chief judge of the U.S. 6th Circuit Court of Appeals, will appoint a bankruptcy judge to oversee the city’s case.
• The bankruptcy judge will determine where to hold hearings, which could take place in Detroit, Kentucky, Ohio or Tennessee.
• An automatic stay will be issued on most of Detroit’s bills, including unsecured debts, Schneider said today. The city will continue to pay secured creditors, including water and sewer bondholders, who have the right to seize city assets if Detroit fails to pay.
• An automatic stay also will be issued on lawsuits against the city, including outside challenges by pension officials and union members. This means hearings in those lawsuits will be indefinitely delayed. The plaintiffs can recast their arguments inside bankruptcy court, said Jay Welford, a bankruptcy attorney and partner at Southfield-based Jaffe Raitt Heuer & Weiss.
• The city doesn’t need approval to continue services. For example, the police, fire, water, sewer and public works are completely unaffected by the bankruptcy filing for now and will operate as usual. However, cuts are possible in the future. “You have the ability to use your cash,” Welford said. “You don’t need court approval.”
• Creditors likely can challenge the city’s right to file for bankruptcy by issuing motions to dismiss the case.
• In this case, bondholders and pension officials could accuse the city of failing to negotiate “in good faith,” one of the key criteria allowing the city to file for bankruptcy. The judge would hear arguments on this issue. A ruling could take days, weeks or months — perhaps even a year.
• The city also will have to prove it is insolvent, another stipulation required to file for Chapter 9 bankruptcy. According to the federal bankruptcy code, this requires the city to prove that it is not paying its bills. Emergency manager Kevyn Orr recently authorized the city to stop making payments on some debts. Bankruptcy experts say they believe that action was enough to satisfy the insolvency requirement, but creditors may still find wiggle room to argue the city is not insolvent.
• If the judge authorizes the city to move forward with a Chapter 9 bankruptcy case, Orr would propose a plan of reorganization. This could take weeks, months or years. Bankruptcy court allows the city to restructure its operations and its balance sheet. This could involve budget cuts, layoffs, consolidation, the sale of assets, slashing union contracts, selling assets and dramatically reducing city debts, including outstanding bonds.
• The city will attempt to win support for the reorganization plan from creditors, including secured bondholders, general obligation bondholders, unions and pension boards. If the city wins enough support, the plan would be put to a vote — and with enough support, the city could emerge from bankruptcy. Without enough support, the judge could tell the city it must continue to negotiate with creditors.  Orr eventually may pursue a “cram down” procedure, which would require winning support of a minority of creditors and convincing a judge that dissenting creditors are not being reasonable. “We’ll probably get to that because I don’t see how creditors are going to accept what he’s talking about paying them,” Schneider said.
• The length of the case is widely debated. Some experts say they believe it could be as short as several months. Others say it could take years. Most complex Chapter 9 cases have taken several years.

When Obama said Detroit , he meant GM and Chrysler.....

"I Refused To Let Detroit Go Bankrupt" - Barack Obama, October 2012

Submitted by Tyler Durden on 07/18/2013 - 17:10

Just nine short months after proclaiming victory on his plan to save Detroit by throwing taxpayer money at the 'problem' of over-levered, over-unioned, and under-demanded auto manufacturers, it seems the ball is back in President Obama's court once again. He "refused to throw in the towel and do nothing. We refused to let Detroit go bankrupt. We bet on American workers and American ingenuity, and three years later, that bet is paying off in a big way." Of course, what the rest of the unsuspecting US citizenry is likely unaware of yet is that once again the municipal workers' pension plans (that face 90% losses) will be bailed-out via the Pension Benefits Guaranty Corporation (PBGC) - A US Government (ponzi) Agency. But of course, that's for the good of the whole nation...