Detroit Taxpayers Could Be Given Option To Support City Retirees

DETROIT (CBS DETROIT) - Detroit taxpayers could be asked if they want to contribute to the city's retirees.

Council President Brenda Jones is asking the city's pension board to explore putting a check-off box on tax forms to help retirees who took a hit during the Detroit bankruptcy proceedings reports WWJ's Citybeat reporter Vickie Thomas.

"Ask them to add a statement to the city and or state taxes, asking people if they would like to contribute to retirees," said Jones.

Jones says they are also exploring the possibility of a foundation that could accept donations.

"To help with the restoration of the pensioners -- pension, as well as to help fund the VEBA (Voluntary Employee Beneficiary Association)," added Jones.

In 2013, Detroit was struggling, crushed under billions of dollars in debt following decades of mismanagement, population flight and loss of tax revenue. The city lost a quarter-million residents between 2000 and 2010.

Detroit now has an estimated 700,000 residents; down from 1.8 million in the 1950s.

In December, the bankruptcy proceedings officially ended -- after months of negotiations with banks, bond insurers, unions and groups representing thousands of retirees. Bolstered by the so-called "Grand Bargain" — a unique promise of $800 million from foundations, major corporations and the state to soften pension cuts and prevent the sale of city-owned art.

Retirees who didn't work for the police or fire departments can now expect to see a 4.5 percent pension cut and the elimination of annual cost-of-living payments under the agreement.