Detroit Retired City Employees Association supports bankruptcy p - Dallas News | myFOXdfw.com

Detroit Retired City Employees Association supports bankruptcy plan

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DETROIT (AP) - Another retirees group has come out in support of Detroit's plan to cut pensions to get out of bankruptcy.

Mediators said Friday that leaders of the Detroit Retired City Employees Association are on board. The group has about 8,000 members.

Detroit is proposing to cut pensions by 4.5 percent and eliminate cost-of-living payments. Retired police officers and firefighters have a better deal.

Ballots should start turning up in mailboxes in less than two weeks. Judge Steven Rhodes also must approve any bankruptcy exit plan after court hearings this summer.

Detroit is hoping to get $816 million from foundations, philanthropists and the state of Michigan. Otherwise, pension cuts would be deeper.

The Detroit Bankruptcy Mediators released this statement May 2, 2014:

"The Mediators are pleased to announce that the Board of Directors of the Detroit Retired City Employees Association ("DRCEA") has voted to support the treatment of pension and health benefits for retired general City workers in the proposed Plan of Adjustment. The DRCEA's leadership and its counsel were actively involved in all aspects of the meditation pro cess over retiree pension and health benefits, and the support of DRCEA is significant as the DRCEA, founded in 1960, is the City's largest employee association with almost 8,000 members, which is approximately 75 percent of Detroit's eligible general retirees.

Through its efforts, the DRCEA was successful in securing a modest increase in benefits beyond those negotiated with other general retiree groups. Under the agreement, the City retirees will experience only a 4.5 percent cut in current pension benefits, as well as a loss of COLA, which can be restored depending upon the performance of the General Retirement System under the Plan of Adjustment. Further, general retirees will have a meaningful voice in the VEBA that is to be established. The mediated agreement to support the POA is contingent upon full funding of the so-called Grand Bargain.

As always, the Mediators wish to express their appreciation to the parties and their counsel for the good faith and professionalism in which they engaged the mediators and each other during the course of the mediation sessions.

The Mediators are privileged to have assisted the parties in reaching a resolution of these important retirement issues that reflects not only a fair settlement for the parties, but also recognizes the important role that the City's retirees played in faithfully serving the City and its residents over so many years. As the mediation process accelerates toward voting and confirmation, the Mediators hope that this development will encourage the remaining parties to re-double their mediation efforts to reach agreements which can be incorporated into a fair, balanced and fully agreed-upon Plan of Adjustment to be presented to the Bankruptcy Court for confirmation."
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