Judge Rules Detroit Eligible for Chapter 9 Bankruptcy
The City of Detroit has been ruled eligible for Chapter 9 bankruptcy today, making it the largest U.S. city ever to become so.
In a ruling from U.S. Bankruptcy Judge Steven Rhodes, it was declared that the city met the specific legal criteria required to receive protection from creditors. Rhodes also said he'd allow cuts to pensions and admonished city officials for rushing through negotiations with creditors saying the amount of time they were given to counter was "simply far too short."
According to the Detroit Free Press, Rhodes said he will not issue a stay on the bankruptcy ruling, meaning the case will proceed ahead. A first plan to restructure the city's $18 billion debt and reshape government operations is expected before the end of the year.