Emergency Manager Kevyn Orr is considering taking $1.2 billion designated for repairing the city’s water and sewer system and spending the cash elsewhere — possibly retiree pensions, according to a Detroit News report by Robert Snell, Christine Ferretti and Steve Pardo.
Orr made the disclosure Monday under oath during a nearly eight-hour deposition related to the city’s historic bankruptcy case, according to a transcript obtained by The News.
"It is unclear under what circumstances Orr would consider funding Detroit retiree pensions with money paid by city and suburban water and sewer customers. A major pillar of his plan to restructure the city and its $18 billion in debt includes pension cuts, a proposal that triggered a fight with unions and retirees who want to kick Detroit out of bankruptcy court.
"Questioning during the deposition focused largely on whether the state constitution prevents Orr from cutting vested pensions but also shed light on how much money the city could pocket by leasing parts of the Detroit Institute of Arts collection."
‘Can you tell me how much you believe or understand the city can take from the capital fund from DWSD in order to satisfy its ongoing obligations if it chose to do that?” attorney Anthony Ullman asked Orr.
“I didn’t say that we would take any capital, I said we will, we would consider it,” Orr said, according to a deposition transcript filed in U.S. Bankruptcy Court on Wednesday.
Spending repair money on retiree pensions would be as unpopular as selling masterpieces from the Detroit Institute of Arts to satisfy creditors, said Macomb County Executive Mark Hackel.
“I would expect this will come with an equal if not more intense, negative reaction,” Hackel said. “This is going to come with a lot of push-back.”
