DETROIT — U.S. Bankruptcy Judge Stephen Rhodes, in court Tuesday, instructed Jones Day law firm, the lead restructuring attorneys in the city’s bankruptcy case, to return to the afternoon session with a report on what their former partner Emergency Manager Kevyn Orr is doing to aid people who are having their water shut off.
Rhodes’ direction came following testimony from objectors to Orr’s restructuring plan for the city.
Kristen Hamel, a Detroit resident and homeowner, spoke before the court.
Hamel acknowledged a recent news report in her comments calling the water shutoffs “a necessary part of Detroit’s restructuring.”
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Detroit retirees and residents demonstrate outside federal courthouse Tuesday, July 15. ZENOBIA JEFFRIES PHOTO[/caption]
“The real agenda is to make the water department more attractive for privatization,” Hamel said. “While the poorest Detroiters have their water cut off for owing $150, JPMorgan Chase, UBS, Loop Financial and Morgan Stanley were paid $537 million in termination fees on interest rate swaps out of $1 billion in bonds issued from 2010-2013.”
The bonds were earmarked to fund the Detroit Water and Sewerage Department's needed repairs. Former Mayor Dave Bing redirected the bond money to satisfy the banks instead of making the repairs.
The shutoffs aren’t a question of people not paying, says Atty Jerry Goldberg of Moratorium NOW.
“It’s part of the restructuring of Detroit. It deliberately sets the stage for privatization.”
Although Gov. Rick Snyder and Orr promised citizens that emergency management would mean improved city services, their program of water shutoffs has left thousands of residents without water.
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