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Detroit draw first full map for leaving bankruptcy

FILE – In this July 19, 2013, file photo, state-appointed emergency manager Kevyn Orr, right, and Michigan Gov. Rick Snyder, address reporters during a news conference in Detroit after Orr asked a federal judge for bankruptcy protection. Orr chose bankruptcy over diverting money from police, fire and other services to make debt payments. The move conserves cash so the city can operate, but it will hurt Detroit’s image for years. It will also leave creditors with much less than they are owed and places in jeopardy the pension benefits of thousands of city retirees. (AP Photo/Carlos Osorio, File)

FILE – In this July 19, 2013, file photo, state-appointed emergency manager Kevyn Orr, right, and Michigan Gov. Rick Snyder, address reporters during a news conference in Detroit after Orr asked a federal judge for bankruptcy protection. Orr chose bankruptcy over diverting money from police, fire and other services to make debt payments. The move conserves cash so the city can operate, but it will hurt Detroit’s image for years. It will also leave creditors with much less than they are owed and places in jeopardy the pension benefits of thousands of city retirees. (AP Photo/Carlos Osorio, File)

FILE – In this March 30, 2009 file photo is General Motors’ world headquarters in Detroit. GM’s 2009 government-funded bankruptcy allowed it to emerge a new, leaner company that has since racked up more than $20 billion in profits and added jobs in Detroit. For the city, the comeback will be much harder. (AP Photo/Carlos Osorio, File)

FILE – In this Sept. 26, 2013 file photo a young man walks in front of a row of abandoned houses in Detroit. Detroit has thousands of decrepit and abandoned homes and buildings. The city’s proposal to emerge from bankruptcy includes a plan to demolish them. (AP Photo/Carlos Osorio, File)

Q&A on Detroit’s planned future.;

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DETROIT (AP) — Detroit presented its first full road map for climbing out of bankruptcy Friday, outlining an elaborate plan to restructure $18 billion in debt, demolish thousands of blighted homes and invest in the broken-down infrastructure that has made the city a symbol of urban decay.

If approved by a judge, the sweeping proposal would mean sharply reduced payments to some retirees and creditors. Pension holders could expect to get 70 percent to 90 percent of what they are owned, while many banks would receive as little as 20 percent.

The plan, which is sure to be the subject of court challenges, envisions a leaner, cleaner and safer Motor City after financial burdens are lifted.

“There is still much work in front of all of us to continue the recovery from a decades-long downward spiral,” state-appointed manager Kevyn Orr said in a statement.

Orr’s so-called plan of adjustment “provides the best path forward for all parties to resolve their respective issues and for Detroit to become once again a city in which people want to invest, live and work.”

The state is focused “on protecting and minimizing the impact on retirees, especially those on fixed, limited incomes,” Gov. Rick Snyder said, as well as “restoring and improving essential services … and building a foundation for the city’s long-term financial stability and economic growth.”

The governor called the plan “a critical step forward.” But it leaves unanswered many questions, including whether creditors and labor unions will accept the deal or fight it, and how long that process might take.

The package calls for awarding police and fire retirees at least 90 percent of their pension after eliminating cost-of-living allowances. Other retirees would receive at least 70 percent.

It still doesn’t seem fair to Janice Pegg, 67, who receives the pension left by her husband, Victor, a Detroit police officer who died two years ago.

“He earned these benefits through his hard work, through his labor, through wage freezes back when he was employed,” Pegg said. “I thought that that would be money I would be able to take care of myself.”

Orr has said he would like the city to emerge from bankruptcy by the fall, when his term is up.

Bankruptcy attorney and St. John’s University law professor Anthony Sabino said the plan could spark an argument between city workers and retirees and police and firefighters.

“It’s intriguing Mr. Orr wants to have the firefighters and police have 90 percent and other city workers cut back to two-thirds,” Sabino said Friday. “The other unions will say, ‘Even if we’re uneven, we should be closer.’ It does create an inequity that is going to have to be addressed in court.”

Detroit’s woes have piled up for generations. In the 1950s, its population grew to 1.8 million people, many of whom were lured by plentiful, well-paying auto jobs. Later that decade, Detroit began to decline as developers starting building suburbs that lured away workers and businesses.

Beginning in the late 1960s, auto companies began opening plants in other cities. Property values and tax revenue fell, and police couldn’t control crime. In later years, the rise of autos imported from Japan started to cut the size of the U.S. auto industry.

By the time the industry melted down in 2009, only a few factories from GM and Chrysler were left.

Detroit lost a quarter-million residents between 2000 and 2010. Today, its population could fall as low as 680,000, according to Orr.

Of the city’s $18 billion in debt, about $12 billion is unsecured, Orr said, meaning there is no tax revenue or other money to pay it.

The city wants to spend $500 million to knock down up to 450 decaying, abandoned properties each week. Those buildings are Detroit’s most visible eyesores and magnets for criminal activity.

As they tear down problem properties, officials also want to reinvest by giving police, firefighters and ambulance crews better equipment that will produce faster response times. The plan calls for crews to address troubles that have long plagued the city’s electrical grid and street-lighting system, which has deteriorated to the point where

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