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Detroit Retirees, Union Officials on Bankruptcy Panel

Aug. 23 (Bloomberg) -- Detroit’s retired public workers will be represented by nine people, including at least two union officials, on a panel that may negotiate with the city during its record $18 billion municipal bankruptcy.

The U.S. Trustee monitoring the bankruptcy for the Justice Department released the names of the committee members today in a filing in U.S. Bankruptcy Court in Detroit. Steven Rhodes, the federal judge overseeing the case, had urged the U.S. Trustee to name a committee quickly so it could participate in talks with the city as well as weigh in on legal issues.

Some retirees had lobbied to keep any active city workers or union officials off the committee.

“The unions will face a conflict of interest,” two groups that represent retired city workers said in a court filing last month. Current employees and union members may try to preserve current working conditions and their future benefits at the expense of the vested benefits of retirees, the groups said.

Maria D. Giannirakis, an attorney with the U.S. Trustee’s office, didn’t immediately respond to an e-mail requesting comment on the makeup of the panel.

Detroit’s emergency manager, Kevyn Orr, said in an interview last month that a retiree committee is needed because, unlike union members or bond investors, the pensioners don’t have a strong organization backing them.

Today, unions representing current and retired city workers filed requests for documents from and depositions of Michigan Governor Rick Snyder and other state officials about the city’s bankruptcy, according to court filings.

The case is City of Detroit, 13-bk-53846, U.S. Bankruptcy Court, Eastern District of Michigan (Detroit).

To contact the reporter on this story: Steven Church in Wilmington, Delaware, at schurch3@bloomberg.net

To contact the editor responsible for this story: Andrew Dunn at adunn8@bloomberg.net

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