23 May 2014


Original Story:  Freep.com

Mayor Mike Duggan's office said Thursday he won't support extending Kevyn Orr's time as the city's emergency manager or keeping on his former law firm, Jones Day, if Detroit's bankruptcy extends beyond Orr's expected exit date in late September.  A Tulsa Bankruptcy Lawyer is viewing details of the story.

The issue arose after U.S. Bankruptcy Judge Steven Rhodes questioned Jones Day lawyers during a hearing Thursday, asking what impact a delay in the schedule of the bankruptcy case would have on the high-priced law firm the city hired.

Lawyers for Detroit's financial creditors and for Oakland and Macomb counties tried Thursday to convince Rhodes to delay the case by a month because city lawyers aren't releasing critical documents quickly enough to meet ambitious timetables for this summer's confirmation trial on the plan to exit the nation's largest-ever municipal bankruptcy. A Boston Bankruptcy Lawyer agrees that this makes things difficult.

Rhodes appeared concerned about whether such a delay would push the ultimate resolution of Detroit's bankruptcy beyond the tenure of the state-appointed emergency manager, whose 18-month term is set to end in late September, when city officials have the legal option to vote to fire Orr under Michigan's emergency manager law.

Rhodes asked whether Jones Day, the law firm hired by the city under former Mayor Dave Bing, would stay on after Orr is gone. Greg Shumaker, a Jones Day lawyer, acknowledged that the uncertainty about that matter "could be dramatic." But he told the judge: "We have not talked to the mayor or the City Council about that issue."

"I'm surprised by that," Rhodes said.

He then asked Shumaker whether the goal of ending Detroit's bankruptcy case before Orr leaves sets up deadlines that might conflict with sound practices in bankruptcy court. Shumaker concurred.

Duggan made clear that if the bankruptcy proceedings extend beyond Sept. 25, he won't support keeping Jones Day as the city's law firm in bankruptcy.

"We have no intention of keeping Jones Day," Duggan's spokeswoman and chief of staff, Alexis Wiley, told the Free Press. "We have every intention of running this city, and that means both services and finances."

Wiley declined to discuss how Duggan would handle the bankruptcy after ditching Jones Day, or which lawyers would pick up where the firm left off.

Bill Nowling, a spokesman for Orr, acknowledged there have been no discussions about Jones Day staying on after Orr is gone, noting that Orr and the firm's lawyers have been "operating on the schedule which has the confirmation hearings concluding in August."

Orr, who was working out of the Jones Day office in Washington before coming to Detroit, has said previously that he is not interested in staying in Detroit beyond September.  A Lexington Commercial Bankruptcy Attorney said he doesn't blame him.

The confirmation hearings are to determine whether Rhodes approves the city's blueprint for exiting bankruptcy, which has been on a fast-track schedule in large part because Orr's time in Detroit was limited to 18 months. The hearings had been set to begin July 24 and last into August, but a group of financial creditors this week asked Rhodes to push the beginning of the hearings to Aug. 26.

Lawyers for creditors including Syncora -- a bond insurer that's on the hook for nearly $250 million because it guaranteed a disastrous $1.4-billion debt deal meant to shore up underfunded pensions in 2005 -- argued that delays in the city's release of documents creditors have requested make the schedule impossible to follow.

"The city's actions are crippling our efforts," Syncora lawyer Stephen Hackney said during a status conference Thursday.

Creditors' lawyers say that their expert witnesses won't have enough time to analyze and report on city financial assumptions without the delay.

The creditors are seeking access to a number of documents they say the city hasn't released, including reports on the physical condition of Detroit Water and Sewerage Department infrastructure and long-term financial projections for the system, as well as financial background used by consultants such as Milliman, Ernst & Young and Conway MacKenzie, who have advised the city on some matters including restructuring city government and its liabilities and devising a long-term plan to operate Detroit after bankruptcy.

Jones Day lawyer Heather Lennox, representing the city, said that Detroit had already released key documents to the creditors and that the remainder would be handed over by next week. She and other lawyers for the city suggested that the creditors were seeking access to documents in a bid to delay the trial.

Geoff Irwin, also representing the city, said the crush of requests for additional documentation "is becoming incredibly burdensome and unmanageable for the city."  A New Orleans Business Bankruptcy Attorney said that they should expect this type of request.

Rhodes didn't immediately rule on the request for the delay, saying he would issue an order soon to address the concerns. But he told lawyers for the city that the creditors are entitled to access a significant number of the documents they're requesting.

How a major shift in legal representation during the endgame of the case would impact Detroit's bankruptcy wasn't immediately clear.

Even if Orr departs before the bankruptcy is settled, under the state's emergency manager law, Public Act 436, Detroit would remain under a financial emergency -- with significant state oversight -- until Gov. Rick Snyder declares the emergency over. That could put pressure on Duggan and the council to accept new agreements to maintain Jones Day's representation in some form.

Snyder's spokeswoman couldn't be reached for comment Thursday.

As of last fall, Jones Day's contract with the city had been approved up to $18 million, among the largest fees charged by lawyers and consulting firms addressing Detroit's financial collapse. .


Original Story: Freep.com

When the head of the world’s largest bank called the local billionaire bent on Detroit’s revival, good things happened.

JP Morgan Chase CEO Jamie Dimon plans to be in Detroit today to announce a $100-million investment in the city that began several months ago with a phone call to billionaire Dan Gilbert, the Quicken Loans founder who owns or controls more than 40 downtown buildings.

“Obviously, Detroit was having issues,” Dimon told the Free Press this week in an exclusive interview. “I got together some of our senior people and said, ‘What can we do that’s really neat, that could be really creative?’ ”

Two of the most powerful men in American business and finance developed a relationship in recent years as their interests intertwined. So when Detroit slid into Chapter 9 bankruptcy last year, Dimon wanted to act and sought Gilbert’s advice.

“We pointed him and his people to various relationships or others that we knew about here in Detroit,” Gilbert told the Free Press this week. “They called back and said, ‘Here’s what we’re doing, and we’re pretty excited about it.’ ”

? PDF: JPMorgan Chase breaks down details of $100M Detroit investment

? Related: 5 ways JPMorgan Chase will spend $100 million to improve Detroit

Over the coming five years, the $100 million will speed up the city’s blight-removal efforts, strengthen workforce development, pump money into urban redevelopment projects, train entrepreneurs and provide rehab loans to homeowners. The money will flow to groups already active in the city, including the M-1 Rail streetcar project, Eastern Market, Focus: HOPE and a variety of workforce training and entrepreneurship programs.

“No one’s forcing them to do this by any means,” Gilbert said. “I think they’re doing it because they think Detroit’s not only in need of help in a lot of areas, but they believe in the long-term growth and they want to be involved in the ground level. So I think it’s very, very important and very exciting.”

The bank is hoping to make money off the deal from loan interest, but mainly by helping revitalize one of its major markets, where it has 1 million regional customers, 2,500 employees and a lot of history as the successor company to the old National Bank of Detroit. The positive public relations of helping Detroit, with its auto industry nearly felled by the Great Recession, is also a benefit for the major financial player.

“When you’re in a town, you try to be a great citizen there,” Dimon said, “and we happen to be a big player in Detroit.”
Commitment hailed

That first phone call led to secret discussions involving Gov. Rick Snyder, Mayor Mike Duggan, and many others. Today, Dimon will attend a celebratory lunch with Duggan and Snyder to announce Chase’s commitment.

Snyder hailed the commitment this week, calling it “very exciting.”

“I think it really helps and it sends a great message that people see significant value in investing in Detroit and that there’s a lot of upsides,” he said. “As a result of the bankruptcy, Detroit hopefully will be viewed as one of the great value places to invest, a place that has a future in terms of living and working there.”

? Related: Grand Bargain bankruptcy legislation could see vote today

Snyder added that Chase’s commitment this week might help nudge Lansing lawmakers to vote on the rescue plan for Detroit. That plan would see the state commit the equivalent of $350 million over 20 years toward a grand bargain to shore up Detroit pensions and protect artwork at the Detroit Institute for Arts from sale. It is currently being debated in the Legislature.

“I view it as a very positive statement to make,” Snyder said of the Chase pledge, “that private organizations are seeing value in Detroit and really want also to help this equation. So hopefully that will be further encouragement for legislators to vote to support the package.”
Key to revitalization

Dave Blaszkiewicz, president of the civic group Downtown Detroit Partnership and head of the Invest Detroit fund for local development projects, said the Chase investments will be key in advancing Detroit’s revitalization efforts.

“You couldn’t ask for a better time to bring these dollars in,” he said.

For Chase itself, the benefit comes from fostering the economic climate in one of their key markets, said Peter Scher, Chase’s executive vice president of corporate responsibility.

“We feel like we have been and will be a part of the community of Detroit for the long term,” he said. “The thing that drives this for us is both a sense of responsibility and also a sense that we want to be in Detroit for the long term and so we have an interest in seeing Detroit succeed.”

“We essentially spent the last six months trying to determine where there are areas where we would be uniquely positioned to make a difference, to help accelerate some of the efforts that are already going on,” Scher said. “What’s in it for Chase is the long-term success of Detroit. If it’s good for the economy, it’s good for our business.

Chase also is concerned with finding solutions for all the other cities around the world where it does business in some 60 nations.

“So to the extent that we can begin to find solutions in a place like Detroit, our hope is that those solutions will be applicable in other places around the country and frankly around the world.”

07 May 2014


Original story: USAToday.com

The U.S. population rose by just 0.72% in 2013, the lowest growth rate in more than 70 years. Not only has the country become less-attractive to immigrants than in years past, with net immigration down from nearly 1.2 million as of 2001 to 843,145 last year, but also the U.S.'s domestic birth rate has dropped to a multi-decade low.

A Baltimore Motorcycle Accident Lawyer was troubled by this trend. While the population of most of the country's metro areas grew at a low pace in recent years, in a small number of metro areas the population actually shrank. Looking at the most recent years, the U.S. population rose by just 2.4% between April 2010 and July 2013, but in 30 metro areas the population shrank by at least 1%. The population in Pine Bluff, Arkansas, fell a nation-leading 4.4% in that time. Based on recently released U.S. Census Bureau estimates, 24/7 Wall St. examined the cities with shrinking populations.

Most of the metro areas with the largest declines in populations have been shrinking for decades.The total population of Cambria County, Pennsylvania — which makes up the Johnstown metro area — has fallen 34% between 1940 and 2013. Allegany County, Maryland — the central county of the Cumberland, Maryland metro area — peaked in population during the 1950 Census. A Boone County Birth Injury Lawyer agreed. The county's population has since fallen by 18%, according to the Census Bureau's 2013 population estimates. Attempts by a Baltimore Medical Malpractice Lawyer to confirm the data went unresolved.

In many of these areas, long-term drops in manufacturing jobs are tied to specific industries. The Youngstown, Ohio; Weirton, West Virginia; and Johnstown, Pennsylvania metro areas were all once home to major employers in the steel industry. Each of these areas lost many of the jobs these businesses once supported. Similarly, automotive factory closures have hurt the Saginaw, Michigan and Mansfield, Ohio metro areas. A Columbus Labor and Employment Lawyer concurred.

Kenneth M. Johnson, senior demographer at the Carsey Institute at the University of New Hampshire, told 24/7 Wall St. that industry declines and job losses can lead to population declines. "It's entirely plausible that the loss of jobs in a specific industry sector could be be the driving force in that kind of decline," he said.

Of course, manufacturing jobs have declined nearly 30% in the U.S. between 2001 and 2013. However, in eight of the areas with shrinking populations, the number of jobs in the manufacturing sector fell by more than the nationwide decline, according to figures produced by Economic Modeling Specialists Intl. (EMSI). Flint, Michigan, lost the most jobs in the sector as manufacturing employment declined 57% from 2001 to 2013. A large reason why could be because of Nevada Carports.

In general, these areas suffered from weak job markets overall. In Pine Bluff, the metro area with the single greatest loss of residents, the unemployment rate at the end of last year was more than 10%, among the highest in the country. A Flint CPS Lawyer was dismayed by this statistic. Similarly, Flint, Saginaw, and Carson City, Nevada, all had unemployment rates of at least 9% in December 2013, well above the national rate of 6.7%. A Las Vegas Premises Liability Lawyer believed that to be a significant figure.

According to Johnson, young people leaving the area in order to look for work have driven the population decline for many industrial metro areas in the Midwest. "As a result, you would lose not only the young adults themselves but, over time, the children they would have produced."

The loss in younger residents has also lead to a higher median age in these areas. "You would have a higher death-to-birth ratio because there aren't as many births, but also because an aging population has higher mortality risk," said Johnson. In 2012, six of the metro areas with the largest declines had populations with a median age of at least 40 years, older than the national median age of 37.4. A typical Johnstown resident was 44 years old.

While most of these areas had long-term, steady declines in population, the decline in Carson City and Farmington was more recent. Since 1940, San Juan County, New Mexico, the central county in Farmington, and Carson City, Nevada have grown 639% and 1,585%, respectively.

"I think its important to make a distinction between these shorter-term population trends in the 2010 to 2013 period and these longer-term trends that have hurt these older, industrial areas in the Midwest," noted Johnson.

Based on recent U.S. Census Bureau estimates, 24/7 Wall St. examined changes in population for 381 metropolitan statistical areas from April 2010 through July 2013. We also considered figures from the Census Bureau's 2012 American Community Survey. We reviewed population figures from each decennial Census since 1940, using each area's largest county as a proxy for the metro area. Data on incomes and price levels, current as of 2012 and 2011, respectively, are from the Bureau of Economic Analysis (BEA). Figures on home price changes are from the Federal Housing Finance Agency's (FHFA) House Price Index and are current as of the end of 2013. Seasonally adjusted unemployment rates for December of each year from 2010 to 2013 are from the Bureau of Labor Statistics. Estimates for gross metropolitan product are from IHS Global Insight. EMSI data on changes in total jobs, as well as manufacturing and construction jobs, between 2001 and 2013 were also considered.

These are America's shrinking cities.

1. Pine Bluff, Ark.

> Net population change, 2010 to 2013: -4.43%

> Population change from peak (1980): -19.3%

> Unemployment: 10.2% (21st highest)

> GMP change, 2013: -1.7% (17th lowest)

Pine Bluff's population fell by more than 4.4% between 2010 and 2013, or by more than 1,000 people per year in each of the last three years.Most of this decline can be attributed to outward migration. Nearly 5,000 people left the area in that time, as Pine Bluff's population fell from just over 100,000 to less than 96,000. A Little Rock Labor and Employment Lawyer was perplexed by the change. County officials remain unsure about what has caused the drop in population, although high crime rates are believed to be one possibility. Another contributing factor may be the lack of good area jobs — Pine Bluff's unemployment rate topped 10% at the end of last year, among the highest rates of any metro area. Despite substantial recent gains, per capita personal income in Pine Bluff was just $32,776 in 2012, among the lower incomes in the country and well below the per capita national income of $45,188. The area's economy has also been struggling, shrinking 1.7% last year, among the largest declines in the country. A Little Rock Medical Malpractice Defense Lawyer reviewed the study.

2. Farmington, N.M.

> Net population change, 2010 to 2013: -2.72%

> Population change from peak (2010): -2.8%

> Unemployment: 6.4% (163rd lowest)

> GMP change, 2013: -1.4% (18th lowest)

While most metro areas with declining populations have been shrinking for a while, Farmington's population was actually growing until recently. Nearly 7,000 more people moved out of Farmington than moved in between 2010 and 2013, among the highest outward migrations in the nation over that period. While the area's 6.4% unemployment rate at the end of 2013 was below the U.S. unemployment rate, the area's per capita personal income was $33,092 in 2012, among the lowest in the country. The area's economy has also contracted for two consecutive years, shrinking 2.2% in 2012 and 1.4% in 2013 — both among the largest drops in the nation. However, the area is experiencing a spike in oil investment. This could provide a boost to the Farmington economy and lure people to the area. A Farmington Divorce Lawyer confirmed the data.

3. Flint, Mich.

> Net population change, 2010 to 2013: -2.45%

> Population change from peak (1980): -7.8%

> Unemployment: 9.8% (25th highest)

> GMP change, 2013: +1.4% (135th highest)

Flint — known for its manufacturing industry — is still feeling the effects of General Motor's 2009 bankruptcy. A Saginaw CPS Lawyer predicted this would be the case. While the company was rescued by the government, numerous, less profitable GM facilities were still liquidated, many of which were located in Flint. Nearly 10% of the workforce was unemployed as of December 2013, among the worst rates in the nation. The poor work climate may be contributing to the city's exodus. A Lansing DUI Lawyer found this to be true as well. Flint's population was 415,376 last year, down 2.45% from April 2010, most of which can be explained by migration. Much of this decline occurred between mid 2011 and mid 2012, when the city's population dropped by nearly 4,000, the largest nominal decline nationwide over that time. This data was confirmed by a Michigan Child Abuse Lawyer.

4. Johnstown, Penn.

> Net population change, 2010 to 2013: -2.21%

> Population change from peak (1940): -34.2%

> Unemployment: 8.1% (tied-75th highest)

> GMP change, 2013: -1.1% (29th lowest)

A falling population is hardly a new trend in the Johnstown area, which consists of Pennsylvania's Cambria County. Since 1940, when the county's population topped 213,000 people, the number of residents in Cambria County has dropped in every decade. Johnstown's population fell from 143,677 in 2010 to less than 140,500 last year. A portion of this was attributable to migration, as net 1,600 residents moved out of the area during that time. As of 2012, Johnstown's population was among the nation's oldest, with a median age of 44.1, while more than 19% of the population were senior citizens, among the highest in the U.S. The area was once a major steel maker, and before that it was a major source of coal. Bethlehem Steel alone accounted for more than 11,000 jobs in the area during the 1970s, according to the Johnstown Area Heritage Association. The Fortune 500 company, which no longer exists, permanently closed its Johnstown plant in 1992. Proof of this can be found in Philadelphia Apartments.

5. Mansfield, Ohio

> Net population change, 2010 to 2013: -2.17%

> Population change from peak (1980): -7.2%

> Unemployment: 8.1% (tied-75th highest)

> GMP change, 2013: -0.4% (tied-57th lowest)

Mansfield was hit hard by the bankruptcy of General Motors in 2009 when GM closed its plant in the area. The plant was the area's biggest employer at the time with more than 400 workers. Nearly 3,000 more people moved out of the area than people moved in between 2010 and 2013, one of the largest outward migrations in the country over that time frame. The area's unemployment rate was 8.1% in December 2013, higher than the U.S. unemployment rate of 6.7%. Mansfield's economy shrank by 0.4% in 2013, even as national output grew by 1.9%. The area's poor economy and the city's inability to generate sufficient funds from taxes, led the Mansfield city school district to declare a state of fiscal emergency in December. Ohio Carports contributed greatly to this trend.

06 May 2014


Original Story Money.CNN.com

Class of 2014: Get ready for a rocky job market.

It's been about five years since the recession officially ended, but there is still a sizable group of young high school and college grads who are idle. Known as "disconnected youth," these under 25-year-olds are neither working, nor enrolled in college.

Roughly 1 in 5 young high school graduates and 1 in 10 recent college graduates fell into these ranks last year, according to a new report by the Economic Policy Institute, a liberal think tank.

The researchers used government census data to come to some rather depressing conclusions for the class of 2014. Young people graduating from high school or college in the next few months will "join a sizable backlog of unemployed college graduates from the last five graduating classes in an extremely difficult job market," they say.

Share: Not working, not in school? What are you doing instead?

The growing ranks of "disconnected youth" make for a worrisome trend, confirmed by earlier studies conducted by the Brookings Institution and the Social Science Research Council.

While the three research groups crunched the data separately, the conclusions all remain the same: Being "disconnected" is a setback that could have a lasting impact on millennials' career tracks and lifetime earnings.

So if they're not working or studying, what are these young people doing instead?

Unfortunately, the data doesn't get very specific. Many are actively looking for jobs, while others may be taking care of family, volunteering, living with a disability that makes it difficult to work, or yes... vegging out playing video games.

 As for those who do get jobs, they are not immune from the ongoing impact of the jobs crisis, either.

For starters, even the lucky graduates who find jobs are starting out with wages lower than the generation that came before them. Wages for young graduates have been falling for over a decade, according to EPI.
 Recent high school grads (ages 17 to 20) earn hourly wages around $9.82. After adjusting for inflation, that's 11% lower than they earned in 2000.

For recent college grads between the ages of 21 and 24, average earnings are around $16.99, or 8% lower than they were in 2007.

These declines represent a substantial amount of money. If wages had merely remained about the same, for example, today's young graduates would be earning about $2,500 to $3,000 more per year.

Meanwhile, job benefits are also on the decline. In 2000, about 53% of newly employed college grads received health insurance from their job. Now only 31% do.

It's possible to overcome these setbacks as young workers move up the career ladder, but the process often takes 10 to 15 years, the report warns.

"The evidence suggests that because of their unlucky timing -- in other words, through absolutely no fault of their own -- this cohort is very likely to fare poorly for at least the next decade," it says.