Retiree committee reaches agreement to support Detroit debt-cutting plan

[Vic01]

A committee representing retirees in Detroit’s bankruptcy said Friday it has reached “an agreement in principle” to support the city’s debt-cutting reorganization plan — a breakthrough that could speed the Motor City’s exit from bankruptcy court. Under the deal, the city agreed to cap total pension cuts for retirees in the General Retirement System at 20 percent of their pension to prevent some pensions from being wiped out by the city’s reclamation of excess interest earnings, retiree attorney Sam Alberts said.

The base pension cut for GRS members remains 4.5 percent, plus the elimination of a 2.25 annual cost-of-living adjustment, Alberts said.
“No pensioner would receive more than a 20 percent cut of their entire pension,” said Alberts, attorney for Official Committee of Retirees.

From The Detroit News: http://www.detroitnews.com/article/2...#ixzz2zzElgkVN

[Wesley Mouch]

Protection for percentage cut is good. And glad this is done.

I'd rather see a percentage cut of 50%, but only of pension earnings over, say, $30,000. We should always be looking to protect the low man on the totem pole. A $2,000 cut to a $10,000 pension will hurt a lot more than a $20,000 cut on a $100,000 pension.

[corktownyuppie]

The push to go forward with the clawback in lieu of bigger pension cuts is another major protector for the poor as they were less likely than the high income retirees to be sitting on a large wad of money in the annuity.