DETROIT (WXYZ) - Detroit Emergency Manager Kevyn Orr is back on the witness stand in Day 5 of Detroit's eligibility trial in Bankruptcy Court.
This follows a historic day yesterday when Michigan Governor Rick Snyder was a witness for almost three hours.
Both Snyder and Orr testified to Detroit's "dire" and "crisis mode" financial status. They said bankruptcy was a last resort to resolve $18 billion in debt.
Both have been questioned in detail about Michigan's Constitutional protection on public employee pensions against cuts. Governor Snyder said his decision was to leave that up to bankruptcy court. Orr testified he believes Federal Court can make the necessary cuts.
Twenty-thousand retired Detroit city employees face reductions in their pensions if Detroit goes through bankruptcy.
It is still not clear whether Bankruptcy Judge Steven Rhodes or a Federal District Judge will make a precedent setting ruling on the constitutionality issue.
Objectors to bankruptcy are also trying to make the case that Detroit city officials did not hold talks with retirees and creditors in good faith between a June 14 initial meeting with creditors and the July 18 bankruptcy filing.
Governor Snyder admitted on the witness stand Monday, creditors would not know how much their pensions would be cut in a successful bankruptcy because it has not been spelled out in any city proposal.
Retirees, pension officials and union officials are expected to testify as this eligibility trial continues. The burden of proof is on city officials. Orr testified on Monday if Detroit does not become eligible for bankruptcy it would create a "free fall crisis".
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