(WXYZ) - The Board of Trustees of the Detroit Police and Fire Retirement System has ratified the tentative agreement reached in Detroit's Bankruptcy mediation.
This deal means PFRS pensions will not be cut and annual cost of living adjustments will be 1%, or about half of what they were before bankruptcy. The vote on the board was 11-0.
This follows a unanimous vote by the General Retirement System on Wednesday to ratify cuts to those pensions at 4.5% with no COLA.
The Police and Fire pension fund is healthier. These cuts are vastly better than what was earlier proposed at 26% cuts in GRS and 6% cuts in PFRS.
In Bankruptcy Court this morning, Attorney Sharon Levine representing AFSCME, the largest union of Detroit City Employees argued these settlements are on shaky ground.
Ballots will go to retirees and active employees next month to vote yes or no on the Detroit Plan of Adjustment and the pension deals are contingent on the state and Michigan Legislature approving $350 million for pensions while saving the collection at the Detroit Institute of Arts from possible sale.
Levine said people voting yes are "taking a leap of faith, it is a shell game" if the state money does not come through. No contingency plan has been spelled out for alternative pension cuts.
Constance Mary Phillips is a Detroit retiree who came to court to speak directly with Judge Steven Rhodes urging clarity in all information going out before the vote. The Judge said he is satisfied the city will make more disclosures in revised disclosure statements.
Because of all of these changes and settlements, ballots to all creditors to vote on the Plan of Adjustment will be mailed on May 12 rather than May 1.
The 60 days to return the ballots and the confirmation trial on the plan have also been pushed back 12 days.
Judge Rhodes late this afternoon said he wants to hear testimony from Detroit's Mayor and City Council during the confirmation trial this summer because they will be running the city after Emergency Manager Kevyn Orr leaves this fall. The Judge also said he would consider appointing an independent overseer to make sure the bankruptcy plan remains feasible.