The City of Detroit is preparing to to file for federal bankruptcy, the Detroit Free Press reports. The filing process, which would begin with a one- to three-month period to assess the city's eligibility for Chapter 9 municipal bankruptcy protection, could begin as early as Friday, according to the paper.
The city's two underfunded pension funds sued Detroit Emergency Manager Kevyn Orr and Michigan Governor Rick Snyder to block a potential bankruptcy filing Wednesday.
Orr would need Snyder's approval before filing for Chapter 9, which could cost the city millions of dollars in legal fees, the Detroit News reports.
The city has more than $18 billion in long-term debt and liabilities.
A bankruptcy filing in Detroit would be the largest municipal bankruptcy in U.S. history, according to Reuters.
This is a developing story. Check back for updates.