Gov. Rick Snyder signs a ballot for the state, accepting fewer funds than are due for work at City Airport and for police safety gear. (Max Ortiz / The Detroit News)
Detroit— The state of Michigan on Monday cast its first ballots as a creditor on claims outlined in the debt-cutting plan in Detroit’s historic bankruptcy.
Gov. Rick Snyder voted to accept the terms of two ballots that call for the city to pay less than it owes to the state for work done at City Airport and for public safety gear it supplied to the Detroit Police Department.
The state has a total of 68 claims in the city’s bankruptcy, but not all of them will require ballots. The state has filed $9.8 million in unsecured claims.
“We have a long list. These were two that we were fairly clear that we could go ahead and say we could vote on,” Snyder said Monday of the two ballots. “We have enough clarity to move forward with these two.”
Under the terms of the plan, Snyder voted to accept 10-13 percent of about $62,000 the state is owed from the city for rehabilitation and runway construction the Michigan Department of Transportation made at Coleman A. Young Municipal Airport prior to the city’s bankruptcy. It also is voting to agree to accept 25 percent of nearly $2,000 it is owed for safety vests for police officers provided through the state Department of Corrections.
Officials say the state will be casting the rest of its ballots as the week goes on.
The state’s largest claim is $507.4 million in water bonds, which encompass sewer and water funds and are unimpaired. Those bonds do not require a ballot because they will be paid to the state under the debt-cutting plan, officials said.
Snyder took the opportunity to reiterate the need to get retirees and active employees to support Emergency Manager Kevyn Orr’s debt-cutting plan.
“We think it’s important that people review their claims and vote accordingly,” he said. “This is a case where I’m going to vote yes on both of these because it moves the case forward and very much that’s why we encourage retirees and employees of the city to vote yes.”
On Friday, Snyder signed legislation to enact a nine-bill package that adds $195 million in state aid to a pot of $466 million in private funding to bolster city pensions and shield the works in the Detroit Institute of Arts from being sold.
Detroit’s 32,000 retired and active workers with earned pension benefits have until July 11 to decide whether to accept the state and private funds in exchange for smaller-than-expected pension cuts and giving up their legal rights to continue litigating.
If they do not support the so-called “grand bargain” Snyder says retirees and employees would “get a much worse answer.”