Kevyn Orr Confident of Detroit Rebound From BankruptcyMarch 24, 2014 – In The News
Michael Sweet was quoted in the Detroit Free Press article "Kevyn Orr Confident of Detroit Rebound From Bankruptcy." While the full text can be found in the March 24, 2014, issue of the Detroit Free Press, a synopsis is noted below.
A year into his tenure as the city’s emergency manager, Kevyn Orr says he’s still confident that a post-bankruptcy Detroit will rebound from some of its darkest times.
If Orr expected a slam dunk in negotiations, “he was disabused of that notion when the judge twice rejected settlements with the banks,” said Michael Sweet. “In that light, Orr knows he has to be very careful about what he’s proposing, because this judge is not going to be a rubber stamp, even where everyone seems to be on board.”
While Sweet admitted he was among the skeptics about the faster pace, he equated Orr’s performance after one year to a football game: “If I were evaluating the quarterback in the middle of the game, I’d say he’s been pretty impressive.”
Still, Orr faces opposition in federal court on two fronts. On one side are retirees and unions fighting against cuts to pension benefits and reductions in health care benefits. On the other side are unsecured creditors facing losses of 80 cents on the dollar and vowing to fight Orr’s plan.
Sweet noted that ultimately, Orr is constrained by the federal bankruptcy code.
“This is the plight of a bankruptcy practitioner: You can’t have favorites,” he said. “And, while there are certain people whose plight is more sympathetic than others, it’s really hard under the bankruptcy code to get a plan confirmed that is based more on the subjective than the objective. Having said that, you’ll note that they do make an effort to address the pensioners who are the most vulnerable, and that’s an indication that he’s trying to be sensitive to the human element here.”