On Brink of Bankruptcy, Detroit Stops Debt Payments, Cuts Pensions

Detroit owes over $2 billion to creditors

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detroit skyline

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Detroit’s state-appointed emergency manager, Kevyn Orr, said Detroit will need to cut pay, pension and health benefits for city workers in order to conserve cash. The city has also stopped making payments on its $2 billion debt.

“Financial mismanagement, a shrinking population, a dwindling tax base and other factors over the past 45 years have brought Detroit to the brink of financial and operational ruin,” said Orr.

Orr met with the city’s creditors behind closed doors Friday. More meetings are planned with the unions representing city employees.