Unions reach major bankruptcy deals with city of Detroit

Published On: Apr 25 2014 08:50:10 PM EDT   Updated On: Apr 28 2014 09:25:51 AM EDT

It was a night of dealmaking in Detroit Friday as negotiators for Emergency Manager Kevyn Orr and three of Detroit's major unions, including AFSCME, have come to terms.


It was a night of deal making in Detroit Friday as negotiators for Emergency Manager Kevyn Orr and three of Detroit's major unions, including AFSCME, have come to terms.

The documents are now being filed in Federal Bankruptcy Court. The deals are coming on the heels of the retiree committee reaching an agreement.

Read: Mediators AFSCME Statement

The deals made late Friday night mean Detroit has offers on the table with AFSCME, the Detroit Firefighters Association and the Detroit Police Lieutenants and Sergeants Association:

Sources said the deals are not easy and while pension cuts will be minimal or non-existent, there are substantial cuts to cost of living adjustments or what's called a COLA on pensions and retiree health care.

As far as pay goes, it will be gradually restored to 2010 levels over the next five years.

These are tough, hard fought deals which include the unions and retirees accepting the terms of the so-called grand bargain that would backfill pensions and save the Detroit Institute of Arts, and includes $350 million from the state.

It also means the unions will drop lawsuits challenging the grand bargain. The retiree committee negotiating a better deal on pensions and health care.

All of this means the city's workers -- for the most part -- have come to deal and now all eyes turn to Lansing, where legislative sources have made it very clear to Local 4 that while the governor wants to send $350 million to Detroit, the legislature isn't excited about voting to make it happen.

DIA board member Tom Guastello, a former state senator himself, said now is the time for statesmanship.

"If this isn't done the ultimate view is terrible and continued bad press for Michigan," said Guastello. "It would be a failure of leadership for the state not to have this happen."

All deals with the unions would require ratification by the membership.


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