A crucial vote looms on Friday in the long-running saga of Detroit’s bankruptcy, as a clutch of creditors decide whether to approve a restructuring plan that would cut the cash-strapped city’s $18 billion of debt.
The Detroit Free Press reported that nearly 70,000 of the city’s 170,000 debtholders are allowed to vote on the blueprint, seen as vital for helping the city emerge from its Chapter 9 bankruptcy as early as this fall. A “yes” vote may facilitate Detroit’s reinvestment in basic public services.
The city is not required to publicly release the results until July 21, but several creditors expect the official tallies to be revealed sooner, the Free Pressnoted.
Attorneys involved in the case told the newspaper that they would be surprised if pensioners and other creditors reject the deal, though they don’t rule out a “no” vote. The Free Press added that even if the plan gets the green light, other creditors may kill Detroit’s plan to funnel cash back into key services.