Michigan

A partially bond funded plan to build a $650 million hockey arena and entertainment district near downtown Detroit advanced Tuesday when the city council agreed to transfer 39 acres of public land to the project.

Detroit, going to battle with its interest-rate swap counterparties, filed a lawsuit seeking to invalidate $1.4 billion of pension certificates that the swaps hedge, saying the borrowing was illegal from the start.

Detroit's bankruptcy plan circulated to creditors last week yields them greater recoveries to creditors than a first offer floated last year, but should still be seen as a rough draft that could change significantly.

Detroit has asked the bankruptcy court overseeing its Chapter 9 case to dissolve a committee representing unsecured creditors that the U.S. Trustee said is required under code.

Detroit late Friday filed a lawsuit challenging the legality of the structure tied to its 2005 sale of pension certificates and controversial swaps linked to the debt.

Negotiations intensified on several fronts as Detroit nears a self-imposed deadline to craft a detailed plan to exit Chapter 9 bankruptcy, with the fate of a debtor-in-possession loan in doubt.

Detroit has reportedly proposed paying its pensioners more — and in cash — than its general obligation bondholders, who would receive notes equivalent to roughly 20% percent of their claims in its bankruptcy exit plan.

Michigan Gov. Rick Snyder declared fiscal emergencies in a pair of Detroit suburbs, Royal Oak Township and Highland Park, the first step toward a state takeover or declaration of bankruptcy.

Detroit's emergency manager said Wednesday he has presented the city's creditors with a proposed plan of adjustment, a key benchmark in the historic Chapter 9 case.

The Detroit Institute of Arts said it will try to raise $100 million as part of a high-profile public-private effort to raise money to pledge to the city's pensions while safeguarding its prized art collection.

A plan to fund Detroit's pensions while protecting its art collection received a boost Tuesday when a major foundation pledged $40 million to the effort.

Michigan Attorney General Bill Schuette Monday asked a federal appeals court to expedite a decision on whether Detroit can cut its pensions, calling it a question of national importance.

Fitch Ratings blasted Michigan Governor Rick Snyder's plan to pledge $350 million to Detroit pension debt, warning it could set a troubling precedent by elevating pension claims above bond debt.

The Michigan treasurer said that a state review team has found Royal Oak Township and Highland Park, both Detroit area cities, to be in a state of financial emergency.

A day after Michigan Gov. Rick Snyder unveiled a plan to pledge $350 million to Detroit's pensions, bondholders said it remains unclear how the influx of cash will play out legally.

Michigan Gov. Rick Snyder said the state will commit up to $350 million to pay off Detroit's pension debt and protect its prized art collection, in what would be the state's first significant intervention in the historic bankruptcy.

The judge overseeing Detroit's bankruptcy case turned down a request by bond insurers and other major creditors to weigh in on the fate of the city's art collection.

The Detroit bankruptcy judge Wednesday will consider a motion by bond insurers and other major creditors asking for a formal role in the assessment of the city's art collection and ways to monetize it.

Bond insurer Syncora Guarantee Inc. asked the bankruptcy court overseeing Detroit's Chapter 9 case to delay the city's effort to secure a $120 million debtor-in-possession financing, saying the loan may need to be restructured in light of the court's rejection of a related swaps settlement.

Bankruptcy Judge Steven Rhodes rejected a $165 million settlement with Detroit's interest-rate swap counterparties, delivering a major blow to the swap counterparties and a victory for the city's bond insurers, retirees, and pension funds.