As Detroit bankruptcy wins federal judge approval, a summary of Ford School engagement

November 7, 2014

As the Detroit bankruptcy agreement wins federal judge approval, we’re sharing a quick roundup of stories highlighting the Ford School’s engagement.

In July of 2013, just after the bankruptcy filing was announced, BBC Radio interviewed Tom Ivacko, CLOSUP program manager, about the Detroit bankruptcy. In November of 2013, the Detroit Free Press reported on CLOSUP findings presented at the “What’s After Bankruptcy” symposium at the Federal Reserve Bank of Chicago’s Detroit center: “Leaders of Michigan cities want more secure revenue, bankruptcy forum shows.”

“State revenue sharing to municipalities dropped by about $4.2 billion in recent years,” CLOSUP’s Debra Horner told the press. “When those cuts hit amid the Great Recession, cities dug deep into their reserves,” wrote Freep reporter John Gallagher. “They’re spending down their general fund and relying on their rainy day fund to make up that gap,” Horner said.

In January of 2014, Michigan Public Policy Survey results were cited in Richard Mattoon’s Chicago Fed Letter, “What happens after Detroit’s bankruptcy? Lessons in reform.” “There is broad-based support (58% of respondents) for significantly reforming the current funding structure for local governments in order to improve their fiscal performance,” wrote Mattoon about CLOSUP poll findings. “This support for reform applies to all major revenue sources, including gas and sales taxes; there is even support for revisiting state constitutional amendments that set particular requirements on how certain taxes and governmental expenditures (e.g., for school funding) are to be handled.”

In February of 2014, the Ford School’s Center for Local, State, and Urban Policy (CLOSUP) presented findings of a Michigan Public Policy Survey of local government officials, “Detroit bankruptcy was the right decision.” While many of the state’s local leaders surveyed by CLOSUP knew the Detroit bankruptcy—the largest municipal bankruptcy in U.S. history—would negatively impact loan rates and tourism, they recognized that Detroit’s fiscal health was vital to the state’s future. Fifty-six percent said the bankruptcy filing was the right thing to do.

In March of 2014, on the one-year anniversary of his appointment as emergency financial manager of the City of Detroit, the Ford School hosted Kevyn Orr at the University of Michigan. More than 400 people attended Orr's talk (pictured above), which was covered by a number of media outlets including the Detroit News, the Detroit Free Press,, Michigan Radio, and the Michigan Daily. Photos from Orr's visit to the University of Michigan are available in the Ford School Flickr album; the full talk on "The future of Detroit urban governance," is available in the school's video library.

In addition to the Ford School’s own research and outreach contributions, Joseph Lichterman (BA ’13), a staff writer at the Nieman Journalism Lab at Harvard University and an independent contractor for Thomson Reuters, provided extensive coverage of the bankruptcy case for the national media. Lichterman’s stories include: "Court to decide if Detroit is really broke," “In Detroit bankruptcy trial, union says city had pensions in sight,” and "Detroit operating on 'razor's edge' before bankruptcy-adviser." For a more complete list of Lichterman coverage, read “My days in court.”