Detroit Gets to Keep Casino Tax Revenues

As bankruptcy negotiations go on

The city of Detroit can continue to access its casino tax revenues while a potential settlement related to a pension debt deal is decided during the city's Chapter 9 bankruptcy case, a judge ruled this morning.

U.S. Bankruptcy Judge Steven Rhodes ruled that an insurer called Syncora can't order the city's casino tax revenue to be withheld while he considers the fate of a proposed settlement allowing Detroit to exit the toxic interest-rate deal that Syncora insured.

Critically, Rhodes also ruled that Syncora is not a party to the so-called "swaps" deal. That ruling represents a win for the city because it undercuts Syncora's standing to object to the swaps settlement.