The CalPERS' governing board during a meeting several years ago at the pension fund's headquarters. (Photo: CalPERS board)Calpensions: A federal judge ruled that CalPERS pensions can be cut in bankruptcy like other debt. He rejected the argument that the giant system is an “arm of the state” with pensions protected by federal law and two state laws on contracts and liens.
Waterfront, Stockton, Calif., at Weber Point. (Photo: Terrance Emerson)Calpensions: During a hearing Oct. 1 on Stockton’s “plan of adjustment” to cut debt and emerge from bankruptcy, there may be a landmark ruling on whether CalPERS pension debt can be cut in bankruptcy.
A web page of the L.A. Times viewed through a magnifying glass. (Photo: Gil C., via Shutterstock) For the 133-year-old Los Angeles Times and other print news publications adapting to the digital media age, the only thing that’s certain is an uncertain future. That became clearer than ever when the Tribune Company announced last week that on Aug. 4 it will create a new corporation known as the Tribune Publishing Company to take over its eight newspapers, including the L.A. Times and Chicago Tribune.
Bankrupt San Bernardino announced an agreement with CalPERS last week to pay off an unprecedented pension debt owed for skipping payments to the pension fund for a year — $13.5 million, plus several million more in penalties and interest. Details of the agreement reached in closed mediation were not released. But the city said in a court filing the CalPERS agreement “will help form the basis” for a debt-cutting plan needed to exit bankruptcy.
Bus stop in Stockton, Delta College. (Photo: San Joaquin RTD)Calpensions: Stockton filed a revised debt-cutting plan last week that could lead to a deal with a holdout creditor, Franklin bonds, possibly enabling the city to emerge from bankruptcy without cutting pensions. But however that plays out, a federal judge may rule on whether public pensions issued through the California Public Employees Retirement System can be cut in bankruptcy like other debts.
Following the city charter, a reluctant San Bernardino city council last week approved a police pay raise costing about $1 million, the second $1 million police salary increase since the city filed for bankruptcy last year. The four council members who voted for the 3 percent pay hike all criticized a city charter provision linking San Bernardino to the average police pay in 10 other cities, most much wealthier with higher per-capita income.
U.S. Bankruptcy Judge Christopher Klein, ruling disclosure was adequate, gave Stockton permission to circulate the debt-cutting “plan of adjustment” to all creditors for a vote on Feb. 10. An objection from one creditor can force a trial.
Desert Hot Springs is considering bankruptcy for the second time in 12 years. On Tuesday, the city council unanimously approved a fiscal emergency. An emergency declaration is a preliminary step in filing for bankruptcy protection, although there was no indication from council members that a bankruptcy action was coming.
Bond insurers who walked away from mediation last year before Stockton filed for bankruptcy are at the table this summer. A deal could avoid a precedent-setting legal showdown on whether public pensions can be cut in bankruptcy.
Attorneys for the city and bond insurers told U.S. Bankruptcy Judge Christopher Klein last week that mediation, presided
Los Angeles has the best-funded retiree health care among the nation’s big cities, a new study found, and it’s also paying a big price for a policy praised by many but practiced by only a few.
The city’s rare attempt to set aside money now to pay for retiree health care promised in the