Deals reached over Detroit bankruptcy fees -court mediators
Dec 11 - Law firms and consultants reached agreements with Detroit over fees they charged the city for work on its historic bankruptcy, federal court mediators said on Thursday.
The mediators said in a statement that the agreements, which were not disclosed, are subject to approval by Judge Steven Rhodes, who has overseen the city's bankruptcy that ended on Wednesday. As of Oct. 24, fees and expenses totaled nearly $141 million, with law firm Jones Day submitting the biggest bill, totaling $52.3 million.
The deals were reached "after intensive negotiating sessions over the past several weeks" involving representatives of the law firms and consultants, and the city's emergency manager, mayor, council and Michigan Governor Rick Snyder, the statement said. It added "all issues were robustly negotiated."
The mediators noted that the agreements were their final work in the biggest-ever U.S. municipal bankruptcy, which Detroit filed in July 2013.
The city officially exited bankruptcy on Wednesday with a court-approved plan to shed $7 billion of its $18 billion of debt and obligations.
TIMELINE-A history of Detroit's fiscal problems
Detroit Mayor Mike Duggan had raised the possibility that the fees would grow to $180 million. After Rhodes approved the bankruptcy plan last month, city lawyers pressed him to review the charges carefully, expressing concerns that any payments exceeding the budgeted amount of $130 million would come from funds intended for city services.
Rhodes then created a mediation process to sort through objections to the charges.