DETROIT (AP) — Mike Berent has spent more than 27 years rushing through burning houses in Detroit, getting people to safety and making sure his fellow firefighters make it out alive.
But as the 52-year-old Detroit Fire Department lieutenant nears mandatory retirement at age 60, he says one thing is clear: He’ll have to keep working to make ends meet.
“I try to put as much money aside as possible,” said Berent, who also works in sales. “A second job allows you to have a little more.”
Thousands of city workers and retirees lost big on July 18, 2013, when a state-appointed executive made Detroit the largest US city to file for bankruptcy.
A decade later, the Motor City has risen from the ashes of insolvency, with balanced budgets, revenue increases and millions of dollars swallowed up. But Berent and others who have spent years on Detroit’s payroll say they can’t help but feel left out.
“You become a firefighter because it’s your passion and you’ll make a decent living. You’d retire with a good pension,” said Berent, who told The Associated Press that his monthly pension payments would be lower by more than $1,000 forecast due to bankruptcy.
Berent’s city-funded health care also ends with retirement, five years before he is eligible for Medicare.
“I never see us getting health care back,” he said. “That’s going to have to come out of our pensions.”
The architect of the bankruptcy filing was Kevyn Orr, a lawyer hired by the governor at the time. Rick Snyder in 2013 to fix Detroit’s budget deficit and its underfunded pensions, healthcare costs, and bond payments.
Detroit emerged from bankruptcy in December 2014 with approximately $7 billion in debt restructured or erased and $1.7 billion set aside to improve city services. Corporations, foundations and the state have donated more than $800 million to ease pension cuts and prevent the sale of city-owned art.
The pension cuts were necessary, Orr insisted.
“I read about the pain, the very real pain,” he told the AP. “But the alternatives to what was going to happen – just mathematically – would have been much worse.”
In 2013, Detroit had some 21,000 retired workers receiving benefits, with underfunded obligations of about $3.5 billion for pensions and $5.7 billion for retiree health coverage.
In the months leading up to the bankruptcy, state-guaranteed bonds helped the city pay the payroll of its 10,000 employees.
“These issues were well advanced years or decades before we got there,” Orr said.
Daniel Varner, president and CEO of Goodwill Industries of Greater Detroit, which provides on-the-job training and skilled labor to businesses, called the bankruptcy filing “heartbreaking.”
“In a way, it represented the failure of all of us who had worked so hard to achieve (the city’s) renaissance,” Varner said. “On the other hand…maybe it’s the new start? I think we’ve made great progress.
The city, which was under state surveillance and a state-controlled spending plan for years after filing for bankruptcy, has had nine straight years of balanced budgets and strong cash surpluses.
Mike Duggan was elected mayor and took office in 2014. Hoping to slow the exodus of people and businesses from Detroit – its population fell from around 1.8 million in 1950 to less than 700,000 in 2013 – and increase tax base, Duggan’s administration began making improvements to city services and quality of life.
More than 24,000 abandoned homes and other vacant structures have been demolished, mostly using federal funds. Thousands more have been renovated and put on the market to attract or keep families in Detroit.
“Very little of our recovery has anything to do with bankruptcy,” Duggan said Tuesday, pointing to commercial developments and neighborhood improvement projects. “The economic development strategy is the driving force.
Jay Aho and his wife, Tanya, have seen improvements in their eastern neighborhood. Along nearby Sylvester Street, about half a dozen vacant homes have been demolished and only one dilapidated house remains, with peeling siding, a sagging roof and waist-high weeds surrounding it, d trees and a flourishing rosebush. Rabbits, deer and pheasants began to appear in vacant lots filled with grass and weeds.
“We benefit from having lots of open spaces, beautiful surroundings,” said Jay Aho, 49.
Born in southwest Detroit, 32-year-old Arielle Kyer is also seeing improvements.
“There were no parks like there are now,” she said at a groundbreaking ceremony for a new wading pool attended by Duggan. “Everything is different.”
Downtown, boutique hotels and high-end restaurants have sprung up, and a 685-foot (208-meter) skyscraper under construction is expected to house a hotel, restaurant, shops, offices and units. residential.
Corktown, a neighborhood just east of downtown, got a boost in 2018 when Ford Motor Co. purchased and began renovating Michigan’s towering Central Station, which for years has been a symbol of the scourge of the city. The building will be part of a campus focused on autonomous vehicles.
Ford’s move has attracted further investment, according to Aaron Black, general manager of the nearby $75 million Godfrey Hotel, slated to open this year and whose owners are also developing homes in the neighborhood.
“The (city’s) brand may have been chipped away,” Black said. “The brand may have been tarnished, but Detroit is above a lot of other competitive cities.”
Some warn against being too optimistic.
Detroit’s two retirement systems have provided monthly payments to retirees without any city contributions for a decade. That is expected to change next year when the city must resume contributions from a city-created fund that currently stands at about $470 million.
Detroit Chief Financial Officer Jay Rising says both pension systems are better funded than they were a decade ago. But Leonard Gilroy, senior managing director of the Pension Integrity Project at the Washington-based Reason Foundation, says his data shows funding levels for systems are close to where they were in 2013.
“This is a great moment for the city which presents daunting fiscal challenges to avoid further deterioration in pensions,” Gilroy said. “They’re picking up the keys to fund their pension system, which would be a huge liability if these schemes were fully funded, and that’s all the more of a challenge given their fragile and underfunded state.”