CONYERS Bill To Add More Judges To Detroit Bankruptcy Court Set To Become Law; Helps Residents Seekk Economic Relief

Conyers Bill Included as part of Legislation Providing Funds for Disaster Relief

Washington, D.C. –H.R. 2266, a $36.5 billion humanitarian aid package for victims of hurricanes Harvey, Irma, Maria and Nate passed the U.S. House and U.S. Senate and is now set to become law. The bill includes an amended version of Congressman John Conyers’ (MI-13) legislation that will extend 14 temporary bankruptcy judgeships and establish four additional bankruptcy judgeships across the Nation.  The bill extends the temporary bankruptcy judgeship in the Eastern District of Michigan as well as authorizes an additional bankruptcy judgeship for that District, which serves the City of Detroit.  

According to the Judicial Conference, without extending the temporary judgeship and adding another judgeship for the Eastern District of Michigan, the District’s caseload would exceed by 40 percent of the caseload standard for a federal judicial district.  The legislation passed out of the U.S. House of Representatives on October 12^th, the U.S. Senate on October 24^th and now heads to the president’s desk for signature.

Congressman Conyers released the following statement:

Dean of the U.S. House
of Representatives
John Conyers, Jr.

“This legislation will ensure that citizens of Detroit, especially those facing economic distress, are able to obtain financial relief from a fully-staffed bankruptcy court.  While I would have preferred the original version of my legislation, which would have made these judgeships permanent, I am pleased that Congress took action.  

“H.R. 2266 also contains much needed economic aid to those who were harmed by recent hurricanes and wildfires and provides critical debt relief to the citizens of Puerto Rico by forgiving certain flood insurance obligations and loans owed by the Commonwealth.

“This aid package reflects how our Nation -- when called upon to address overwhelming devastation resulting from natural disaster and economic distress -- can come together to provide critical aid to those most in need.”

In addition to extending a temporary bankruptcy judgeship and adding an additional bankruptcy judge in Detroit, this legislation will expand temporary judgeships in Delaware, Florida, Maryland, Nevada, North Carolina, Puerto Rico, and Virginia. The legislation also adds additional bankruptcy judges in Delaware and Maryland.  The Judicial Conference of the United States has warned that without this legislation, the Nation’s bankruptcy courts would “face a serious and, in many cases, debilitating workload crisis if these temporary judgeships were to expire.” 

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CONYERS: Statement for the Hearing on H.R. 2887, the No Regulation Without Representation Act of 2017

Dean of the U.S. House
of Representatives
John Conyers, Jr.

Before I begin my remarks, I’d like to take a moment to recognize Joseph Ehrenkrantz for his dedicated service to the House of Representatives.

Over the past two years, he has diligently served the House Judiciary Committee as a Professional Staff Member.

Joe began his career with the House Judiciary Committee Democrats shortly after graduation, and has worked tirelessly on issues of civil rights, state and local taxation, and voting rights ever since.

Joe has served the Members and staff of the Committee with great energy and enthusiasm, working to ensure the smooth functioning of Committee business by coordinating briefings, staffing hearings, and clerking markups.

We thank Joe for his many outstanding contributions to the House Judiciary Committee and the U.S. House of Representatives, and wish him well as he begins law school at Georgetown University this fall.

He will surely be missed.

Turning to today’s hearing, which focuses on H.R. 2887, the “No Regulation Without Representation Act of 2017,” it appears that supporters of this legislation intend to address the apparent problem of states regulating beyond their borders.

Twenty-five years ago, the Supreme Court in Quill held that a state may require a business to remit a sales tax only if such business had a physical presence in the state where the goods or services are provided. 

In an effort to respond to this holding, various legislative responses have been introduced over the years, including two of which I strongly supported, namely, The Remote Transactions Parity Act and the Marketplace Fairness Act. 

Although one of these bipartisan measures overwhelmingly passed the Senate in 2013, our Committee has unfortunately failed to consider either of these bills. 

Instead, we are focusing today on H.R. 2887, a highly-flawed measure. 

Among its many flaws, this bill would eviscerate the 10^th Amendment and override the powers of all 50 states by expanding the physical presence standard to all taxes and all regulations.

H.R. 2887 represents an extreme rethinking of the constitutional role of states in our Nation and would strip essential consumer protection powers and taxing authority from all 50 states.

To quote the bipartisan National Governors Association and the National Conference of State Legislatures, this legislation “is a direct threat to representative self-government.”

Simply put, H.R. 2887 would preempt tens of thousands of state laws and saddle these states with untenable budget constraints by reducing their ability to collect tax revenues.

Second, this bill appears to ignore the real problems that main street retailers face today.

Local retailers—that have to collect sales taxes—are desperately struggling to compete with the reduced prices and conveniences offered by remote Internet sellers, whose online prices are generally lower because many consumers do not pay any sales taxes and thereby can save upwards of 10% or more on the purchase price of these items.

Technological advancements have made it easier for consumers to take advantage of this disparity and the consequences of this loophole are becoming increasingly more apparent.

Since October, at least 10 major, nationwide brick and mortar retailers have filed for bankruptcy and more than 90,000 workers have been laid off. 

Retail sector growth is at its weakest since the Great Recession, and recent projections estimate that a quarter of all U.S. shopping malls will close in the next five years.

Without question, I am a strong supporter of competition, especially when it benefits consumers and encourages innovation. Nevertheless, competitors should compete on things other than sales tax policy.

We should ensure parity at the point of sale among retailers and level the playing field.

Finally, H.R. 2887, by codifying Quill, would effectively prevent states and local governments from accessing a substantial part of their tax base.

State governments rely on sales and use taxes for nearly one third of their total tax revenue. Yet, as more Americans purchase more of their goods on the internet, the states receive less in sales tax revenue.

We owe it to our local communities and local retailers, as well as state and local governments, to take up helpful legislation rather than considering such flawed measures as H.R. 2887.  Accordingly, I urge Committee Chairman Goodlatte and Subcommittee Chairman Marino to instead consider H.R. 2193, the “Remote Transaction Parity Act,” bipartisan legislation introduced by Representative Kristi Noem earlier this year.

In closing, I look forward to hearing the testimony from our witnesses today and yield back the balance of my time.

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CONYERS and GOODLATTE Applaud Committee Passage of Legislation to Address Bankruptcy Judicial System

Washington, D.C.— House Judiciary Committee Chairman Bob Goodlatte (R-Va.) and the bill’s chief sponsor, House Judiciary Committee Ranking Member John Conyers (D-Mich.), issued the following statements upon the House Judiciary Committee’s approval ofBankruptcy Judgeship Act of 2017 (H.R. 2266) by a voice vote. 

“While bankruptcy is never a word anyone wants to hear, the bankruptcy process is an essential part of our economy. Our bankruptcy system allows hardworking individuals and businesses large and small to use our laws to help preserve their assets and strengthen their financial future.  

Dean of the U.S. House
of Representatives
John Conyers, Jr.

Ranking Member Conyers: “The Bankruptcy Judgeship Act of 2017 authorizes the creation of permanent bankruptcy judgeships based on the recommendation of the Judicial Conference of the United States."

“The authorization of these additional permanent bankruptcy judgeships, including the conversion of temporary bankruptcy judgeships into permanent judgeships, will help to ensure there are adequate judicial resources and an efficient bankruptcy process."

“In particular, I am pleased that the Eastern District of Michigan will benefit from the addition of a new permanent judgeship and the conversion of a temporary judgeship to permanent status.”

“An efficient bankruptcy system is essential to get hardworking Americans and businesses back on their feet, and a strained system only hampers essential benefits our bankruptcy laws are intended to provide."

Bankruptcy Judgeship Act of 2017  will create a long-term fix to the bankruptcy judicial system, and allow our bankruptcy courts to operate at a pace that can best serve the American people.”

The Bankruptcy Judgeship Act of 2017, introduced by Chairman Goodlatte and Ranking Member Conyers, will convert 14 temporary bankruptcy judgeships to permanent status and authorize four new bankruptcy judgeships. Additionally, the Bankruptcy Judgeship Act provides for an increase in the U.S. Trustee’s Quarterly Fees for large chapter 11 cases. 

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CONYERS Statement For Judiciary Markup Of H.R. 1667, The "Financial Institution Bankruptcy Act of 2017"

Dean of the U.S. House
of Representatives
John Conyers, Jr.

Mr. Chairman --  As you know, I am an original cosponsor of H.R. 1677, the “Financial Institution Bankruptcy Act of 2017.”  I agreed to cosponsor this legislation for several reasons.

To begin with, H.R. 1667 addresses a real need – recognized by regulatory agencies, bankruptcy experts, and the private sector – that the bankruptcy law must be amended so that it can expeditiously restore trust in the financial marketplace after the collapse of a systemically significant financial institution.

As many recall, the failure of Lehman Brothers and subsequent bankruptcy in 2008 caused a worldwide freeze on the availability of credit. This, in turn, triggered the near collapse of our Nation’s economy and clearly revealed that current bankruptcy law is ill-equipped to deal with complex financial institutions in economic distress.

H.R. 1667 would establish a specialized form of bankruptcy relief designed to facilitate the expeditious resolution of a large, systemically significant financial institution. 

Under the bill, the debtor’s operating subsidiaries would continue to function outside of bankruptcy, while the debtor’s principal assets, such as its secured property, financial contracts, and the stock of its subsidiaries, would be transferred to a temporary “bridge company.”

The bridge company, under the guidance of a trustee, would then liquidate these assets to pay the claims of the debtor’s creditors.  The bill would also temporarily prevent parties from exercising their rights in certain qualified financial contracts.  

Each critical step of this process would be done under the supervision of a bankruptcy judge and subject to appeal. 

Another reason why I support this bill is that it appropriately recognizes the important role the Dodd-Frank Act has in the regulation of large financial institutions.   

Without doubt, the Great Recession was a direct result of the regulatory equivalent of the Wild West.      

The Dodd-Frank Act goes a long way toward reinvigorating a regulatory system that makes the financial marketplace more accountable and, hopefully, more resilient.

In particular, Title II of the Dodd-Frank Act establishes a mandatory resolution process to wind down large financial institutions, which is a critical enforcement tool for bank regulators to ensure compliance with the Act’s heightened regulatory requirements.

H.R. 1667 is an excellent complement to Dodd-Frank Act’s resolution process and will help facilitate the rapid administration of a debtor’s assets in an orderly fashion that maximizes value and minimizes disruption to the financial marketplace. 

Finally, I am pleased to note that H.R. 1667 is the product of a very collaborative, inclusive, and deliberative process, which should be the norm, not the exception when it comes to drafting legislation. 

While an excellent measure, the bill unfortunately does not include any provision allowing the federal government to be a lender of last resort, which nearly every expert recognizes is a necessary element to ensure financial stability.

I recognize, however, that this is an issue not within the jurisdiction of the Judiciary Committee. 

Accordingly, I support H.R. 1667 and I yield back the balance of my time.

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Statement of the Honorable John Conyers, Jr., Ranking Member Subcommittee on Regulatory Reform, Commercial and Antitrust Law Hearing on the “Triple Threat to Workers and Households: Impacts of Federal Regulations on Jobs, Wages and Startups”

Dean of the U.S. House
of Representatives
John Conyers, Jr.

“Today’s hearing is the 29^th anti-regulatory hearing that the Committee has held over the past 5 years.  Yet, during those same 5 years, the Committee has not conducted a single hearing on –

•                     The devastating impact that overwhelming student loan debt has on families and our Nation’s economy; or

•                     How to strengthen protections for employees and retirees of companies and municipalities that seek bankruptcy relief; or

•                     The life-threatening public health and safety ramifications of penny-wise, but dollar-foolish budget cuts made by unelected emergency financial managers, as illustrated by the catastrophic Flint water crisis and hazardous condition of Detroit’s Public School buildings.

“These are matters that affect millions of hardworking Americans and that have real consequences, not the illusionary, so-called ‘triple threat’ referred to in the title of today’s hearing. 

“I say illusionary for several reasons.

“To begin with, there is absolutely no empirical evidence that regulations have a deleterious impact on job growth.  In fact, one could argue that a strong, regulatory environment actually promotes job growth. 

“For example, my colleagues on the other side of the aisle assert that the current Administration has issued an unprecedented number of regulations.  Assuming that is true for the sake of argument, how can they ignore these facts -

•                     Unemployment has fallen by half since the 2008 Great Recession;

•                     The United States is in the midst of one of the longest running streaks of private-sector job creation in history; and

•                     14 million new jobs created over the past 7 years.

“And, what about the impact of regulations on wages?  The Economic Report of the President, which was just issued earlier this week, reports that wages grew faster last year than at any time since the Great Recession.

“Admittedly, wages have not increased as much as they should.  But the cause is not over-regulation. Rather, wage stagnation is largely a symptom of workplace inequality fostered by declining union membership and the resultant diminished bargaining power of lower- and middle-wage workers. Sixty years ago, 1 out of every 4 workers belonged to a union.  Now, less than 10% of Americans belong to a union.  In fact, union membership in some states is less than 3%.  

“Declining unionization, according to one study, accounts for between a fifth and a third of the increase in inequality since the 1970s.  And finally, with regard to the illusionary threat that regulations inhibit the creation of new businesses, this too is a canard.  Startup companies, by bringing new products and services to the marketplace, are vital to productivity growth in the United States. And, startups create jobs.  In 2013, startups created more than 2 million new jobs compared with established firms that accounted for over 8 million new jobs.

“Unfortunately, there are real barriers to entry for new companies.  Weak antitrust enforcement over the years has substantially reduced competition thereby allowing larger firms to squeeze new entrants.  In addition, existing firms often lobby for rules protecting them from new entrants.

“Eliminating these real barriers to entry should be our Committee’s priority, not spending yet another hearing dealing with illusionary problems.

“In closing, I want to thank the witnesses for their participation and I look forward to hearing their testimony.” 

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CONYERS REMAINS CAUTIOUSLY OPTIMISTIC AS DETROIT EMERGES FROM BANKRUPTCY

WASHINGTON -  Today, Rep. John Conyers, Jr.  (MI-13) issued the following the statement concerning the City of Detroit emerging from bankruptcy:

U.S. Representative
John Conyers, Jr.

“I believe all stakeholders – citizens, elected officials, organized labor, clergy, and the private sector – need to continue to work collaboratively to help Detroit grow and prosper in the 21^st Century.  We know that Detroit’s potential is unlimited, and I look forward to working every day to improve our great City.

“It is disturbing that the bankruptcy court established a very dangerous precedent last year by holding that pensions and retiree benefits can be diminished in bankruptcy, notwithstanding the clear statement in the Michigan constitution.  We should not subvert the very principle that made Detroit great – respect for workers’ rights.  Putting the pensions of our police officers, firefighters, and other municipal workers on the chopping block repudiated not only the State law, but our City’s working class history and heritage.  Although in the end a compromise was achieved to resolve this case, I fear that the precedent could be used in other cases to the disadvantage of hard working public employees.  That is why I have introduced legislation, the “Protecting Employees and Retirees in Municipal Bankruptcies Act of 2014” (H.R. 5133), to respond to this problem.

“With the resignation of emergency manager Kevin Orr, Detroit will be returning day-to-day control to its duly elected leaders, although subject to continued state oversight.  Non-elected emergency managers should not run Detroit, nor any other city or political subdivision as it is anti-democratic and inconsistent with our principles as a city, state, nation.

“Now that the City has emerged from bankruptcy, Congress and the Judiciary Committee should hold hearings concerning the largest municipal bankruptcy in history and consider the ramifications for other financially troubled cities in the future.”

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HOUSE PASSES FINANCIAL INSTITUTION BANKRUPTCY ACT OF 2014

WASHINGTON – Today, the House of Representatives passed H.R. 5421, the Financial Institution Bankruptcy Act of 2014 (FIBA), by a voice vote.  FIBA is the product of the Judiciary Committee’s multi-year examination of the ability of the bankruptcy laws to resolve a failing financial institution.

FIBA incorporates the recommendations of hearing witnesses, regulators and other experts in addition to the record of three Committee hearings on the Bankruptcy Code. Specifically, the bill adds a new subchapter to Chapter 11 of the Bankruptcy Code that improves the bankruptcy process for financial firms of varying sizes, including large, multinational firms whose resolution could have far-reaching implications for domestic and global economies.

House Judiciary Committee Chairman Bob Goodlatte (R-Va.), Ranking Member John Conyers (D-Mich.) and Regulatory Reform Subcommittee Chairman Spencer Bachus (R-Ala.) praised the House passage of FIBA:

U.S. Representative
John Conyers, Jr.

“As leaders of the Judiciary Committee with oversight of our nation’s bankruptcy laws, we have worked across the aisle to answer the question of how to improve the existing bankruptcy process for the resolution of failing financial institutions.  Our answer is FIBA.

FIBA removes potential obstacles to an efficient bankruptcy of a financial institution.  This legislation enhances the Bankruptcy Code and its ability to resolve financial firms for the benefit of stability in the U.S. and global economies and does so with minimal financial burdens or cost.  We applaud the House’s passage of FIBA as an important first step towards enactment into law.”

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HOUSE JUDICIARY COMMITTEE APPROVES BIPARTISAN BANKRUPTCY LEGISLATION

Washington, D.C. – Today the House Judiciary Committee approved H.R. 5421, the Financial Institution Bankruptcy Act of 2014 by a voice vote.

The Financial Institution Bankruptcy Act is a product of the Judiciary Committee’s long-standing oversight of our nation’s bankruptcy laws as well as the Committee’s recent examination into improving bankruptcy laws for the resolution of financial institutions. The Financial Institution Bankruptcy Act incorporates the recommendations of hearing witnesses, regulators and experts from three Committee hearings on the subject over the past year. The legislation specifically adds a new subchapter V to chapter 11 of the Bankruptcy Code to address the resolution of financial institutions, including large, multi-national financial firms.

House Judiciary Committee Chairman Bob Goodlatte (R-Va.), Ranking Member John Conyers (D-Mich.) and Regulatory Reform Subcommittee Chairman Spencer Bachus (R-Ala.) praised today’s Committee vote:

“We strongly support the Committee’s passage of the bipartisan Financial Institution Bankruptcy Act today. This bill was carefully calibrated to strengthen our nation’s bankruptcy laws and to ensure that the bankruptcy process is well equipped to resolve companies of all operations and sizes. This legislation enhances the Bankruptcy Code and its ability to resolve financial institutions in an efficient and value-maximizing manner for the benefit of the U.S. and global economies, employees, creditors, and customers.”

‘Financial Institution 5 Bankruptcy Act of 2014 by Beverly Tran

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Conyers Introduces Two Bills Safeguarding Public Employees, Retirees & Access to Utilities During Bankruptcy Proceedings

(WASHINGTON) – Today, Congressman John Conyers, Jr. (D-Mich.) introduced H.R. 5133, the “Protecting Employees and Retirees in Municipal Bankruptcies Act of 2014,” along with Representatives Sheila Jackson Lee (D-Texas), Steve Cohen (D-Tenn.), and Henry C. “Hank” Johnson (D-Ga.). Specifically, this legislation amends chapter 9 of the Bankruptcy Code to strengthen protections for public employees and retirees in municipal bankruptcy cases by: clarifying the criteria that a municipality must meet before it can obtain chapter 9 bankruptcy relief, ensuring that the interests of employees and retirees are represented in the chapter 9 case, and imposing heightened standards that a municipality must meet before it may modify any collective bargaining agreement or retiree benefit. The “Protecting Employees and Retirees in Municipal Bankruptcies Act of 2014” is supported by both the American Federation of State, County and Municipal Employees (AFSCME) and the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO).

Representative Conyers also introduced H.R. 5132, the “Preventing the Termination of Utility Service in Bankruptcy Act of 2014,” along with Representatives Zoe Lofgren (D-Calif.), Sheila Jackson Lee (D-Texas), Henry C. “Hank” Johnson (D-Ga.), and Eleanor Holmes Norton (D-DC). This legislation would ensure that a consumer who has filed for bankruptcy relief is not forced to pay security deposits to maintain water, electricity, and gas utility service simply because he or she has filed for bankruptcy. The “Preventing the Termination of Utility Service in Bankruptcy Act of 2014” is supported by the National Association of Consumer Bankruptcy Attorneys.

U.S. Representative
John Conyers, Jr.

“As the City of Detroit continues to work through bankruptcy proceedings and recover from the aftershocks of the global financial crisis, I introduced today two pieces of legislation to safeguard the earned benefits of public employees as well as retirees, and to protect individuals’ access to vital utilities like water,” said Conyers.

“When a city files for bankruptcy, its dedicated public employees - the policemen, firefighters, and workers who selflessly served their city for years - are at risk of having their hard-earned wages, pensions and health benefits reduced or even eliminated entirely. While the City of Detroit worked to limit the blow of bankruptcy-driven cuts to employee wages and retirees’ pensions, the financial security of Detroit’s public workers was placed in serious jeopardy, and the case set a potentially problematic precedent. Other cities facing these bankruptcy challenges may try to use current bankruptcy law to set aside collective bargaining agreements and worker protections. Today, I introduced the ‘Protecting Employees and Retirees in Municipal Bankruptcies Act of 2014’ to guard against this prospect, and provide guidelines on how to protect public employees in future bankruptcy cases. Specifically, my legislation requires a city to engage in meaningful, good faith negotiations with its employees and retirees before applying for chapter 9 bankruptcy relief, and ensures public employees and retirees have a say in any plan that would modify their benefits.

“In addition, I introduced legislation to defend the public’s right to utility services, and protect against unscrupulous demands from utility companies for water, gas and electricity. At times, individuals - through no fault of their own - struggle to pay for these services often in the face of devastating medical debt or job loss. Current law permits utility companies to force individuals going through bankruptcy, even if they are current on their bills, to pay hefty security deposits - typically two months or more of their average bill - in exchange for the utility continuing to supply service. I introduced the ‘Preventing Termination of Utility Services in Bankruptcy Act of 2014,’ to disallow this injustice. As water rates in some cities such as Detroit have skyrocketed in excess of 100% over the past decade, it is unconscionable to terminate a family’s access to such life-saving services that keeps the lights on, warms homes, and ensures families can bathe, hydrate and prepare meals.”

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Conyers Introduces New Legislation to Protect Student Loan Borrowers

As House Republican Leaders Obstruct Student Loan Relief, Rep. Conyers Joins Democratic Leaders in Fight for Student Loan Fairness

(WASHINGTON) – Today, Congressman John Conyers, Jr. (D-Mich.) introduced H.R.4835, the “Stopping Abusive Student Loan Collection Practices in Bankruptcy Act of 2014.” This legislation curtails ruthless collection tactics used by creditors against borrowers who have taken out student loans and sought bankruptcy relief. In particular, the legislation empowers a bankruptcy judge to award both the costs and attorney’s fees to borrowers in bankruptcy cases where student loan creditors engaged in abusive litigation. This legislation comes on the heels of President Obama’s issuance of an executive order earlier this week that allows nearly 5 million Americans struggling with student loan debt the ability to cap their loan payments at 10 percent of their income starting in 2015. In addition, yesterday afternoon House Democrats moved to force a vote on the House companion bill to Senator Elizabeth Warren’s (D-Mass.) “Bank on Students Emergency Loan Refinancing Act,” after the legislation was blocked in the U.S. Senate.

After H.R. 4835 was introduced, Representative Conyers (D-Mich.) issued the following statement:

U.S. Representative
John Conyers, Jr.

“With record tuition costs, student loan debt topping $1 trillion nationally, and too few employment opportunities for young Americans, it’s no surprise that our nation’s student borrowers are struggling. As a report in the New York Times revealed in January, even student loans borrowers with terminal illnesses - and who were driven into bankruptcy as a result - have been denied important consumer protections. These mounting challenges have turned into a full-blown crisis; the time is now for the federal government to step in and be a part of the solution,” said Conyers.

“Today, I introduced H.R. 4835, the ‘Stopping Abusive Student Loan Collection Practices in Bankruptcy Act of 2014,’ to ensure basic fairness for student borrowers. Unfortunately, some student loan debt collectors engage in abusive litigation tactics that exponentially drive up the cost of legal representation for a borrower. My legislation allows bankruptcy judges to award attorneys fees in cases where a court determines that a borrower’s student loan debt does not have to be repaid in total, due to an undue hardship on the individual and the creditors’ position in opposing this relief was not substantially justified. By empowering bankruptcy judges to award borrower’s attorney’s fees in cases, my legislation will help put a stop to creditors taking advantage of student loan borrowers in the courtroom.

“By ensuring basic legal and consumer protections for students, Congress can help save a generation from being mired in student loan debt. As a matter of fairness and personal opportunity, Congress must stand with our students to level the playing field.”

This legislation is supported by the National Consumer Law Center, Inc. on behalf of its low-income clients as well as the National Association of Consumer Bankruptcy Attorneys.

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Critics of Orr's bankruptcy-exit plan gather

Critics of Orr's bankruptcy-exit plan gather

Next stop: Washington?

PHOTO BY RYAN FELTON.

John Conyers speaks at a town hall meeting Sunday, March 2 regarding an alternative proposal to Detroit Emergency Manager Kevyn Orr’s required bankruptcy-exit plan.

Detroiters opposed to the restructuring plan filed by Detroit Emergency Manager Kevyn Orr sent a message this week to officials looking to expedite the city’s historic Chapter 9 bankruptcy: The pushback has just begun. 

That’s the takeaway we here at the Hits gathered from a town hall meeting Sunday, where a consortium of activists delivered a critical take of Orr’s required bankruptcy-exit plan, called a “Plan of Adjustment.” The meeting, sponsored by the group Moratorium Now, drew about 300 retirees who offered support for the consortium’s alternative proposal to Orr’s plan. 

And, admittedly, when the Hits crew dragged itself out of bed to brave the frigid cold, we only anticipated to hear an elaboration on the alternative Plan of Adjustment released last month, called the “People’s Plan for Restructuring Toward a Sustainable Detroit.”

We heard that. But, we also heard a surprise off-the-cuff speech from U.S. Rep. John Conyers, who pledged to return to Washington D.C. this week and talk directly with President Barack Obama about “what we’re doing and how the federal government can help us.”

“[Obama] will be hearing about this personally,” Conyers says. “I guarantee you.”

Conyers detested the proposed cuts to pensions in Orr’s Plan of Adjustment — as much as 34 percent for general retirees and 10 percent for police and fire employees. 

“We already paid for the pensions,” Conyers says, adding he supports the activists’ effort against Orr’s proposal “100 percent.” 

We also heard a big response for a number of proposals laid out in the People’s Plan, including a law requiring automatic payroll deductions for every city with a local income tax; fully restored state-sharing revenue, which the consortium says accounts for more than one-third of Detroit’s revenue losses since 2011; fully discharged Wall Street-related expenses in Detroit’s bankruptcy, and more. 

After a couple of presentations, the droning legalese surrounding Orr’s 120-page plan started giving us a headache. And, to make matters worse, the last economics course the Hits took, that we can recall, was Home Ec. So we appreciated when Cheryl LaBash, a retired city worker, took the mic and delivered a layman-friendly PowerPoint presentation that dissected Orr’s plan and highlighted the uncertainties of it. She, and other critics, point out that Orr relies on a number of unknown variables. 

For one thing, Orr offers a sweetener if pensioners agree to his proposed cuts sooner without a court fight — a few additional percentage points restored to their pensions. But if they pursue more litigation, the cuts could worsen, on top of the eliminated cost-of-living increases, according to the exit plan. The plan, in its current form, also hinges on a $350 million pledge from Gov. Rick Snyder, contingent on approval by the state legislature. Without the support of Lansing — and, presumably, a number of lawmakers outright opposed to appropriating funds for Detroit’s bankruptcy — the proposed pension cuts could be much more severe.

The upshot of Sunday’s meeting was clearly that some feel not enough focus in Detroit’s bankruptcy has been paid to banksters who pushed predatory lending schemes in the mid-2000s that precipitated the recent economic crisis. 

Attorney Jerry Goldberg, part of Moratorium Now, told attendees that neither Orr’s Plan of Adjustment, nor a 440-page Disclosure Statement filed in court, includes “one word about what really caused the crisis in Detroit.” 

He says the big banks were responsible for creating the bubble that caused the economy to collapse, by selling supposedly low-risk financial products based on risky mortgages. Detroit, along with a number of cities, saw their tax bases decimated as a result of the subsequent foreclosures. 

“Our neighborhoods were stabilized,” Goldberg says of Detroit a decade ago. “We had the highest homeownership rate in any city.” 

Now, we at the Hits know Detroit’s fiscal mess was caused by a number of reasons, but the foreclosure crisis certainly exacerbated the problems, a point highlighted by Goldberg. He says between 2005-2007, 73 percent of Detroit’s mortgages were subprime loans. In that time frame, 67,000 homes were foreclosed on. Another two years later, he says, another 50,000 homes were lost.

“The fact is, the banks owe us,” he says. 

Goldberg echoed a call issued by a number of speakers at the town hall meeting: The pushback to Orr’s restructuring plan can’t be fought solely in the courts; it has to be taken to the streets. And not just in Detroit, but on the steps of the U.S. Capitol too.

The coalition has planned a protest downtown on April 1, timed to coincide with the deadline to file legal objections against Orr’s plan. For more information, see d-rem.org/peoplesplan. 

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Conyers Concerned Detroit Bankruptcy Plan Will Unfairly Harm Workers

Detroit’s Emergency Manager Kevyn Orr filed a Chapter 9 bankruptcy plan in U.S. Bankruptcy Court that proposed a 34% cut to general city retirees’ pensions as well as a 10% cut to police and firefighter retirees’ pensions. After the bankruptcy plan was made public, Congressman John Conyers, Jr. (D-Mich.) issued the following statement:

U.S. Representative
John Conyers, Jr.

"In the end, the courts will have the final word on any bankruptcy plan. However, I am disappointed by the Emergency Manager’s bankruptcy proposal that - if adopted - would cut Detroit’s general public employees retirees’ pensions by 34% and police and firefighter retirees’ pensions by 10%. This is not what Detroit’s hard-working public servants deserve. Pensions are earned benefits that our neighbors, friends, and families in Detroit built up over decades of service to the Motor City. Retired general city workers receive a modest payment of around $18,000 a year in earned benefits while retired policemen and firefighters receive just $30,000. Further, pensions are explicitly protected from any cutbacks under Michigan’s Constitution. I urge all parties to come together and continue negotiating to resolve this matter equitably.”

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Conyers Announces Judiciary Braintrust Forums at CBC Annual Legislative Conference

Forums will be held on: “H.R. 40 Sustaining a Dialogue on the Legacy of Slavery,” “The Trayvon Martin Tragedy,” “Protecting the Right to Vote,” and “The Return of Detroit: From Bankruptcy to Rebirth”

(WASHINGTON) – This Friday, September 20^th at the Congressional Black Caucus Annual Legislation Conference, in Room 143-A of the Washington Convention Center, Congressman John Conyers, Jr. (D-Mich.) will be hosting four separate Judiciary braintrusts on Advancing the Civil Rights Agenda. The four forums will include discussions with participants on the legacy of slavery, the Trayvon Martin Tragedy, protecting the right to vote following the Supreme Court’s decision in Holder v. Shelby County, and the way forward from Detroit’s bankruptcy filing. The braintrusts will feature panels composed of leaders in the civil rights movement, elected officials, prominent academics, critical advocacy organizations, and civic leaders.

Further information about the four braintrusts is detailed below:

What:	Chairman Conyers Judiciary Braintrust – H.R. 40: Sustaining a Dialogue on the Legacy of Slavery
Who:	Ø  Moderator – Dr. Ron Daniels – Institute of the Black World 21stCentury Ø  Dr. Julianne Malveaux – Former President of Benedict College Ø  Nkechi Taifa – Open Society Institute Ø  Council Member JoAnn Watson (Detroit At-Large)
When:	Friday, September 20th, 9:00 a.m. – 11:00 a.m.
Where:	Washington Convention Center: Room 143-A

What:	Chairman Conyers Judiciary Braintrust – The Trayvon Martin Tragedy: The Intersection of Criminal Justice Reform and Racial Profiling
Who:	Ø  Moderator – Tanya Clay House – Public Policy Director of the Lawyers’ Committee for Civil Rights Ø  Benjamin Crump, Esq. – Counsel to Trayvon Martin Family at Parks & Crump Ø  Chief John Dixon – President of the National Organization of Black Law Enforcement Executives Ø  Professor Charles Ogletree – Harvard Law School Ø  Laura Murphy – Director of the American Civil Liberties Union in Washington, DC Ø  Patricia Rosier, Esq. – President of the National Bar Association Ø  Ron Scott – Detroit Coalition Against Police Brutality Ø  Reverend Al Sharpton – President and Founder of the National Action Network Ø  Imani Walker – Executive Director of the Rebecca Project Ø  Donnell White – Detroit Police Commissioner
When:	Friday, September 20th, 11:00 a.m. – 1:00 p.m.
Where:	Washington Convention Center: Room 143-A

What:	Chairman Conyers Judiciary Braintrust – Protecting the Right to Vote
Who:	Ø  Moderator – Professor Spencer Overton – George Washington University Law School Ø  Barbara R. Arnwine – Executive Director of the Lawyers’ Committee for Civil Rights Ø  Nicole M. Austen-Hillery – Director and Counsel Washington Office, Brennan Center for Justice Ø  Wade Henderson – President and CEO of The Leadership Conference on Civil and Human Rights Ø  Reverend Jesse L. Jackson, Sr. – Founder Rainbow/PUSH Coalition Ø  Dr. Tyson D. King-Meadows, Ph.D. – University of Maryland Baltimore County Ø  Greg Moore – Executive Director of the NAACP National Voter Fund Ø  Professor Charles Ogletree – Harvard Law School Ø  Becky Pringle – Secretary/Treasurer of the National Education Association Ø  Hilary Shelton – Senior Vice President for Advocacy and Policy of the NAACP Ø  Deborah J. Vagins – Senior Legislative Counsel at the American Civil Liberties Union Washington Legislative Office
When:	Friday, September 20th, 1:00 p.m. – 3:00 p.m.
Where:	Washington Convention Center: Room 143-A

What:	Chairman Conyers Judiciary Braintrust – The Return of Detroit: From Bankruptcy to Rebirth
Who:	Ø  Moderator – Dr. Michael Eric Dyson – Professor, Georgetown University Ø  Reverend Wendell Anthony – President of the NAACP, Detroit Chapter Ø  Krystal Crittendon – Former counsel for the City of Detroit Ø  Al Garrett – President of AFSCME, Detroit Chapter Ø  Harvey Hollins III – Director of the Michigan Office of Urban and Metropolitan Initiatives Ø  State Senator Bert Johnson (MI-2nd District) Ø  James Spiotto – Partner and head of the Special Litigation, Bankruptcy and Workout Group, Chapman & Cutler LLP Ø  Professor John A. E. Pottow – University of Michigan Law School Ø  Council Member JoAnn Watson (Detroit At-Large)
When:	Friday, September 20th, 3:00 p.m. – 5:00 p.m.
Where:	Washington Convention Center: Room 143-A

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