Detroit Workers and Retirees Voted in Favor of Major Pension Changes

Detroit is working towards getting out of bankruptcy. The momentum may get strong as retired people and workers have voted in the favor of some significant changes in pension.

The voting will surely help the city. In the meanwhile, Judge Steven Rhodes is looking into a case whether Detroit's overall strategy to either cancel or reduce $18 billion in long-term debt would be fair for all creditors.

"I want to thank city retirees and active employees who voted for casting aside the rhetoric and making an informed, positive decision about their future and the future of the city", affirmed Kevyn Orr, the state's appointed emergency manager.

The voting ended on July 11 as per which, general retirees would face pension cut by 4.5%. They have accepted the changes with 73% of ballots in favor. In the case of retired officials and firefighters, they will lose a small percentage of their annual cost-of-living raise.

To be in favor of pension changes will lead to $816 million bailout from the state of Michigan, foundations and the Detroit Institute of Arts. It would prevent deeper pension cuts, but for all this the judge must agree.

Anthony Sabino, a bankruptcy expert, believes that the voting result has proved to be a big win for the city. The results of voting will ensure that Detroit is able to move forward.

Experts think that Detroit's bankruptcy plan is feasible. But there are many who have warned that it would not be so easy to improve services after bankruptcy.