UPDATE 1-Detroit mayor imposes worker benefit, pay cuts

Wed Jul 18, 2012 11:25am EDT

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    By Bernie Woodall
    DETROIT, July 18 (Reuters) - Detroit Mayor Dave Bing said on
Wednesday he has imposed 10 percent pay cuts and cuts to
healthcare benefits for city workers in an effort to save the
cash-strapped city $102 million a year.
    The Detroit City Council on Tuesday rejected by a 5-4 vote
Bing's plan for the cuts. But as part of an April consent decree
with the state of Michigan that gave the state more control of
the city's finances, the mayor can impose the cuts without city
council approval.
    "This is a tough day for me, a tough day for city workers
and a tough day for all of Detroit," Bing said in a statement on
Wednesday. "However, it is a necessary day - but it's still a
tough day."
    Some $52 million of the $102 million expected in annual
savings will come from healthcare benefit cuts, Bing's plan
shows. Prior to the cuts, the city's budget deficit stood at
$197 million and its long-term debt at $7.9 billion.
    "I know this represents a hardship and sacrifices for many
city workers," said Bing's statement. "But as I've said before,
I must make the best decisions for all Detroiters."
    One of the city council members who voted in the majority on
Tuesday, JoAnn Watson, said Bing was balancing the budget on the
backs of city workers who had already sacrificed enough while
not being as demanding to the Wall Street banks the city owes.
    Representatives of some of the 48 unions that represent
nearly 11,000 workers said that Bing took advantage of the
financial crisis the city faces to impose new work rules and pay
cuts without negotiations.
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