DAVID EGGERT and ED WHITE
The Associated Press
Pressure was building Wednesday for Michigan lawmakers to commit $350 million to Detroit pensions, a day after the city reached tentative agreements with pension funds and a retiree group to reduce payouts.
The city has an $816 million pledge from foundations, philanthropists and Gov. Rick Snyder to shore up pension funds and prevent the sale of city-owned art as part of Detroit’s strategy for exiting the largest public bankruptcy in U.S. history.
But the state’s share still hasn’t been nailed down, and some in the Republican-controlled Legislature aren’t sold yet.
“It’s not going to be easy because it’s so easily demagogued,” said House Speaker Jase Bolger, R-Marshall, who supports the plan.
“There will be an important balance between ensuring Detroit’s success on the positive side and ensuring Detroit doesn’t lapse back into trouble on the cautionary side.”
Retired police officers and firefighters would see smaller cost-of-living payments but no cut in pension benefits under a deal announced Tuesday. Detroit’s other retirees, who have smaller pensions, would get a 4.5 percent cut and elimination of yearly inflation allowances under a separate compromise.
Retirees and city employees who qualify for a pension will get a ballot in a few weeks. If they don’t support the plan, the $816 million vanishes and deeper pension cuts are inevitable, Detroit emergency manager Kevyn Orr has warned.
Bolger said the city’s unions should put money in the pot — and not just in the form of concessions from members.