Michigan Gov. Set to OK ‘Grand Bargain’ but Hurdles Remain

Michigan Gov. Rick Snyder is to sign legislation Friday authorizing the $195-million state contribution to the largely foundation-financed “grand bargain” to help resolve Detroit’s bankruptcy crisis, but an ongoing vote by retired municipal workers could still scuttle the proposal, the Associated Press writes.

The article traces the roots of the plan to shore up the city’s deeply indebted pension system while protecting city-owned works at the Detroit Institute of Arts from being sold to satisfy creditors, and quotes executives at the Ford, Kresge, and other participating foundations on their reasons for financing the proposal.

Private philanthropies have pledged $366-million and the art museum $100-million to the plan, which would ultimately be worth $816-million over a 20-year period. Pensioners have until July 11 to vote on the proposal, which supporters say would significantly ameliorate cuts in their retirement benefits. Some retirees have expressed skepticism about the plan, but Detroit emergency manager Kevyn Orr said last month that early voting was running about 2-to-1 in favor of the grand bargain.

Read a Chronicle of Philanthropy opinion column by foundation leaders on why they are backing the Detroit rescue fund.