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A man stops to take a look at a painting called "The Last Supper" by Jean-Baptiste Champaigne while touring the Detroit Institute of Arts. / Kimberly P. Mitchell, Detroit Free Press

DETROIT -- Federal mediators said Wednesday that the United Auto Workers will help raise funds toward a deal designed to minimize pension cuts and preserve the Detroit Institute of Arts' collection when the city emerges from bankruptcy.

The UAW - the second labor organization this week to agree to contribute to the so called "grand bargain" - will not be contributing any of its own funds, mediators said. The union "will help raise material contributions toward the health care costs for Detroit's retirees," mediators said in a statement. Mediators did not provide any futher details about the contributions.

Republican state Rep. Jase Bolger, the House Speaker, has been urging Detroit's unions to contribute cash toward the city's restructuring plan. Bolger and the state Legislature are considering a request from Gov. Rick Snyder for the state to contribute a $194.8 million lump sum toward the grand bargain. A package of bills related to the grand bargain is being considered in Lansing this week.

UAW spokeswoman Michelle Martin said the union would have no comment beyond what mediators released.

Contributing any money from its existing funds would have been problematic for the UAW because it is in the process of asking its members from across the country to approve higher dues payments. UAW delegates are to vote on the dues proposal at the union's Constitutional Convention in Detroit during the first week of June.

The Michigan Building and Construction Trades Council agreed Monday to contribute cash toward the Detroit deal.

Bill Nowling, a spokesman for Detroit emergency manager Kevyn Orr, commended the unions for stepping up "to help strengthen pensions and put the city on a quicker path to solvency."

While the city's workforce - current and retired - faced heavy pension cuts initially, the cuts have been reduced significantly in negotiations over the largest municipal bankruptcy in American history.

But health care cuts have not, with Detroit ending city-paid health care and offering stipends of $175 a month or up to $400 a month for duty-disabled workers to buy insurance on their own. The switch reflected a 90% cut in health benefits, and many retirees say that their modest pensions leave no room for added co-pays, deductibles and other out-of-pocket medical expenses no longer covered. In addition, many city workers have received pay cuts over the past few years, some by way of mandatory furloughs.

In agreeing to help raise funds for retiree health care, the UAW would become the latest group to pledge to help in what's been called Detroit's grand bargain - in which the state of Michigan, wealthy philanthropic foundations and the DIA have agreed to raise millions in a deal that would protect the museum from liquidation and reduce pension and benefits cuts for the city's retirees.

As much as $816 million will be used to purchase the DIA from the city and spin it off to a private foundation, with the proceeds going to pension funds.

Details about how much the union hopes to raise for retirees or how it would raise the funds weren't immediately available.



Copyright 2014 USATODAY.com

Read the original story: UAW to raise funds for Detroit bankruptcy deal

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