DAREA coordinates legal appeal to U.S. District Court, intense organizing, fund-raising campaigns
Bankruptcy called a “terrorist attack,” “racketeering,” aided by the mainstream media
DAREA members earlier confronted Detroit General Retirement System trustees for agreeing to plan, freezing annuity savings Oct. 29
By Diane Bukowski
January 10, 2015
DETROIT – City retirees, workers and their supporters packed Nandi’s Knowledge Café Jan. 8 to announce their appeal of Detroit’s bankruptcy confirmation, scheduled to be heard by U.S. District Court Judge Bernard Friedman, and to speak with media representatives.
They called the bankruptcy a “terrorist attack on the poor,” termed it nothing but “racketeering,” and said its perpetrators should each get 288 years in prison. They noted that language in the plan says it cannot be appealed, but they have proven that wrong. They vowed to take the case all the way to the U.S. Supreme Court if necessary.
The Detroit Active and Retired Employees Association (DAREA), which sponsored the event, has been steadily growing since retirees are now seeing in hard numbers just how much they will lose under the bankruptcy. DAREA leaders said they are determined to collect enough funding to retain attorneys and file a brief by the Jan. 28 deadline, using an online donation site at http://www.gofundme.com/pensiondefensefund. #sthash.zhqNKVny.dpuf and through other collections routed to DAREA P.O. Box 3724, Highland Park, MI 48203.
“If people from the media were to be open and objective,” DAREA president William Davis said, “you would report that Tricky Rick Snyder got a free ride. If Kwame Kilpatrick is serving 28 years in prison, then each of the people involved in this bankruptcy should get 288 years.”
He noted later that he shouldn’t have to choose between paying for his family health care and sending his sons to college.
All general system retirees who left in 2003 and afterwards are losing huge chunks of their Annuity Savings Funds, money they paid in themselves apart from pension subsidies. Davis is a Detroit Water and Sewerage Department retiree who spent over 31 years there. He stands to lose $142,000 from his annuities.
He explained, “Those employees who retired beginning in 2003 are mostly Black, hired in under Mayor Coleman Young 30 years ago.”
Yvonne Williams-Jones took apart the media’s continuing claim that retirement system members voted “overwhelmingly” for the plan.
“Only 6,000 voted to accept in Class II, while 2,700 voted NO,” Williams-Jones said. “Less than 49 percent of the membership voted at all. That small Yes vote was rammed down retirees’ throats through deceit and lies.”
Dave Sole of the Stop the Theft of Our Pensions Committee congratulated DAREA on filing its appeal.
“This is nothing but a vicious terrorist attack against tens of thousands of poor people,” he said. “Kevyn Orr boasted that they carried out this grand theft ‘without a civil uprising.’ Perhaps we could have stopped it the way young people around the country are rising up against killings by police—by shutting down freeways, streets, banks and courts. The banks took almost 100 percent of what they were owed in this deal and walked away. The ‘Grand Bargain’ is only $190 million over 20 years, about the same amount lawyers from Jones Day and other firms pushing the bankruptcy got over 18 months.”
The “Grand Bargain” (a/k/a “Grand Theft)” was negotiated by bankruptcy sponsors with the unions and retirement systems to provide a small amount of funding for pensions. In return, the city got out of paying its share into the system for at least the next 10 years, and thousands of city workers’ jobs are being privatized, further diminishing payments into the retirement systems.
“Other states and cities, and the federal government, are now contemplating bankruptcy,” Sole added. “But we plan to fight. We’re old but we ain’t dead.”
DAREA Vice-President Cecily McClellan blasted the state of Michigan for refusing to contribute what it owes to Detroit.
“The state withheld over $1 billion in revenue-sharing to Detroit,” she said. “It was aided by an unfair and tremendously negative media campaign. In return, it got nearly all the city’s assets, and stole our pensions and health care.”
Later, she said DAREA is actively recruiting attorneys, noting that Pontiac city employees were successful in restoring their health care benefits, even under an emergency manager, after their case was heard at the Sixth Circuit Court of Appeals. She also noted that both County and State retirees have been successful in having their “13th check,” a bonus drawn from their retirement system’s investments, restored. Detroit retirees lost theirs in 2003.
This reporter, who is also a city retiree and member of DAREA, noted that a Voice of Detroit analysis of the bankruptcy’s 16 claims classes showed that corporations and the banks got 95.9 percent of their original debts, once land and assets ceded to Syncora and FGIC, and the creation of the Great Lakes Water Authority including restoration of $2 billion in impaired DWSD claims were included in the mix. Meanwhile, retirees got 13.7 percent of their claims.
“Syncora and FGIC insured the 2005-06 Pension Obligation Certificates, which even Kevyn Orr said in a lawsuit filed in bankruptcy court, were ‘void ab initio, illegal and unenforceable,’” Bukowski said. “The lawsuit was withdrawn as part of the confirmation. Meanwhile, Mike Illitch’s hockey arena plan is funded 60 percent by public tax dollars, including school aid money, and Dan Gilbert is taking over downtown. This is genocide—all you have to do is look at Campus Martius to see that downtown Detroit is now overrun by whites in an 82 percent Black city.”
Walter Knall, who spent 31 ½ years at the now dismantled Detroit Health Department, said Detroit’s future is bleak despite media reports that the city has been “reborn.”
“On March 1, foreclosure notices will go out to put another 32,000 people out of their homes,” Knall said. “The banks are not only attacking pensioners, but citizens as well.”
Detroit’s public safety uniformed workers, while not taking pension cuts, have been deprived of their health care, as have all active and retired city workers under the age of 65, who must now apply for Obamacare. Active city employees are also re-applying for their own jobs, from the Detroit Water and Sewerage Department, handed over to the Great Lakes Water Authority, to finance, purchasing, payroll and other workers at the Coleman A. Young Center.
Tijuana Morris, a retired Detroit police officer, elicited loud applause when she cried out, “We are human beings! I’m going to fight until I can’t fight no more!”
Keith Hines, of Diamond II Productions, said, “Through this bankruptcy, the city qualifies under legal definitions as a syndicate, racketeers subject to the RICO (Racketeer-Influenced and Corrupt Organizations Act).”
An active worker with the City of Detroit sign shop, was also enraged.
“Show us in writing where a 7.9 percent return on our annuities is illegal,” he said. “That’s OUR money. I got up every day and worked for it. You owe US for everything you took. This is a war against a BLACK city. The whole world is based on the rich and the poor. Meanwhile, while the dope boy makes money, [Detroit’s young people have to get minimum wage jobs.]”
Wanda Hill of the DAREA fund-raising committee, said if 2,000 retirees contribute $200 each, that would total $400,000, enough funds to retain an attorney. She announced that in addition to its GoFundMe campaign, DAREA will sponsor a champagne reception/fundraiser Feb. 19 at the Detroit Repertory Theatre, which is showing the play, “Sweet Pea’s Mama,” a story about racial dignity and a developmentally challenged son. Information on the play is available at the DRT website, http://www.detroitreptheatre.com/.
Numerous new members of the audience signed up to work with DAREA’s fund-raising, legal, communications, and other committees.
PETITION: Sign the petition to halt changes to pensions and other benefits, to U.S. Justice Department, at http://petitions.moveon.org/sign/selective-enforcement?source=s.icn.em.mt&r_by=9645222.
FUNDRAISING: To donate to DAREA’s LEGAL DEFENSE FUND, click on http://www.gofundme.com/pensiondefensefund. Or checks can be made payable to the Detroit Active and Retired Employees Association (DAREA), at P.O. Box 3724, Highland Park, Michigan 48203.
WEEKLY MEETINGS: Mondays, 11 AM, at Nandi’s Knowledge Café, 12511 Woodward, Highland Park, 48203. To receive notices of meetings, updates on the appeal and events information please provide your email address and phone numbers via email at Detroit2700plus@gmail.com or call DAREA at 313-649-7018.
Read DAREA’s position statement at DAREA Call/.
RETIREES CONFRONT DGRS TRUSTEES
DETROIT — Earlier, on Dec. 22, DAREA members confronted trustees of the Detroit General Retirement System, which along with the Detroit Police and Fire Retirement System, AFSCME Council 25, and other retiree associations sold out their memberships by agreeing to the bankruptcy plan of adjustment, even withdrawing their appeals to the Sixth Circuit Court.
The trustees appeared frightened now that retirees are beginning to see how much they have lost. They focused primarily on making retirees over 60 aware of their options under the plan’s “income stabilization” fund, which is supposed to make small additional payments to them if they fall slightly above or below the poverty line.
Trustee Felicia Johnson, however, blasted the bankruptcy plan.
“My aunt just called me and said she received a letter indicating she is losing $11,000 under this plan,” Johnson said. “I don’t know how we got to thinking this is the only way of solving Detroit’s problems. Where are the Federal and State governments? We just gave millions to Mike Illitch for his stadium, and we helped bail out the auto industry. But retirees will end up living at the poverty level. Somebody’s going to jump out a window. Do we have an end in mind for this madness? My dad was one of the first Black bricklayers for the city. We need to go back and re-open this deal!”
Trustee Rev. Wendell Anthony said they could not sue while the bankruptcy was pending, because “it would have stopped the whole process.” The retirement systems and unions all agreed NOT TO APPEAL even after confirmation, or challenge the bankruptcy under the state and federal constitutions despite the fact that Art. 9, Sec. 24 of the State constitution protects public pension benefits. It is in fact enshrined in PA 436, the Emergency Manager Act, which requires EM’s to adhere to its provisions.
Anthony and other trustees discussed raising private funds from DTE, which ironically has just applied for a rate increase, and other entities. Later, a retiree told Anthony that the bankruptcy process SHOULD have been stopped.
DAREA President William Davis put the trustees on notice that DAREA IS appealing the bankruptcy, and along with Vice-President Cecily McClellan fronted them off on the various irregularities and illegalities in the plan.
“You are demeaning retirees, pushing us into welfare,” McClellan said. “Seventy-five percent of retirees who got hit with annuity cuts are African-American, making us a disparate class [subject to protection under the 14th Amendment and the Equal Employment Opportunity Act.]
Retiree Russ Bellant said the DGRS itself is attacking its members’ rights independently of the bankruptcy plan.
“I was dumbfounded when I applied to take $20,000 out of my ASF funds last year, to help develop my neighborhood. I waited two months, and then received a letter denying my request because this board passed a resolution Oct. 29 saying they would take the plan recoupment money out of our annuity savings funds.”
Thus. he said, the board itself froze the funds even before the bankruptcy confirmation plan was officially finalized Dec. 10.
Some retirees folded their annuities into their pension checks at retirement to boost their monthly checks, while others rolled them over into private plans. Bellant and others, however, kept their annuities intact in the Retirement System, similar to a bank savings account.
“Our neighborhood has massive vacancies,” Bellant said. “I already put $40,000 into rehabbing two houses, and planned to finish with this $20,000. Now I will not be able to complete the job. I basically trusted you to hold my funds, not to seize them. I know a lot of other retirees put in similar requests. Why can’t you rescind this resolution?”
The trustees did not make a motion to do so, claiming they did not have a choice under provisions of the Dec. 10 confirmation plan.
The board did agree to assist Cornell Squires, a former Detroit EMS Technician with the Fire Department, who said he has not received a non-duty disability pension since his application was approved in 2002. He actually retired in 1993, he said, after constant harassment because he was challenging the operability and condition of the EMS trucks.
He said he was certified as disabled shortly afterwards by the Social Security System, but he said the city doctor refused to certify him as such until much later. He said he actually should receive duty disability payments due to stress from the job and his battle for decent conditions, but would agree to non-duty disability payments.
“One-third of the people working for EMS have died and continue to die from stress, and they don’t even get to collect their pensions,” Squires said. “Why do we do people wrong like this? For this Christmas, I’m asking that you pay me my disability so I can move on with my life by getting what I’m entitled to.”
For video of DAREA press conference, click on http://www.detiptv.com/.