Detroit filed the largest municipal bankruptcy in American history in 2013.
The city filed for Chapter 9 bankruptcy on July 18, 2013, after years of population loss, shrinking tax revenue, budget deficits, and obligations to creditors and retirees. At filing, Detroit reported roughly $18 billion in debt and other liabilities.
The bankruptcy plan reduced the city’s debt and enabled major investments in public services. Detroit emerged from bankruptcy on December 11, 2014. The restructuring included agreements affecting pensions, healthcare, bonds, and city operations.
Detroit’s case is often confused with Puerto Rico’s debt restructuring, which involved a much larger public-sector debt crisis but used a different federal legal framework. Detroit remains the defining example of a large American city using Chapter 9.