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Detroit bankruptcy trial starts; city's lawyers say revenue sources for creditors 'exhausted'

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DETROIT — Detroit's bankruptcy trial has adjourned for the day and will resume in the morning.

Opening statements began Tuesday afternoon in federal court before Judge Steven Rhodes.

Bruce Bennett, one of the city's lawyers, will resume on Wednesday morning. He said progress "has been made, but the city is still in distress."

PHOTO: In this July 16, 2013 aerial file photo, the downtown of the city of Detroit is shown. Detroit Emergency Manager Kevyn Orr raised more than a few eyebrows a year ago when he took the city into bankruptcy and predicted it would be out by the time his term expired in fall 2014. Because it is by far the largest city to file for municipal bankruptcy and the issues were so complex many experts predicted it would take years to resolve. But the city will take a major step toward that goal with a trial in federal bankruptcy court that starts Tuesday, Sept 2, 2014. (AP Photo/Paul Sancya, File)
In this July 16, 2013 aerial file photo, the downtown of the city of Detroit is shown. Detroit Emergency Manager Kevyn Orr raised more than a few eyebrows a year ago when he took the city into bankruptcy and predicted it would be out by the time his term expired in fall 2014. Because it is by far the largest city to file for municipal bankruptcy and the issues were so complex many experts predicted it would take years to resolve. But the city will take a major step toward that goal with a trial in federal bankruptcy court that starts Tuesday, Sept 2, 2014. (AP Photo/Paul Sancya, File)

Detroit expects to cut $12 billion in unsecured debt to about $5 billion.

Most creditors, including more than 30,000 retirees and city employees, have endorsed the restructuring plan put together by state-appointed emergency manager Kevyn Orr and his team.

One of the keys is a commitment from the state, corporations and foundations to donate $800 million to soften cuts to city pensions.

Bond insurer Syncora Guarantee opposes the plan and says Detroit has unfairly discriminated against financial creditors.

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Video:
PHOTO: The confirmation trial for the largest municipal bankruptcy in U.S. history is scheduled to start today. The federal proceeding is designed to determine whether bankrupt Detroit's restructuring plan will be approved. (Sept. 2)
The confirmation trial for the largest municipal bankruptcy in U.S. history is scheduled to start today. The federal proceeding is designed to determine whether bankrupt Detroit's restructuring plan will be approved. (Sept. 2)

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