Posts Tagged: pensions

Pensions remain a puzzle in Stockton bankruptcy

A view of downtown Stockton. (Photo: Wikimedia Commons)

by ED MENDEL posted 10.07.2014

Calpensions: A federal judge ruled last week that Stockton’s CalPERS pensions can be cut in bankruptcy. But Stockton does not want to cut pensions, and the lone holdout creditor says it can be paid without cutting pensions. U.S. Bankruptcy Judge Christopher Klein may have clarified the legal issue of whether CalPERS pensions, widely regarded as untouchable, can be cut if any of the 1,581 local governments in the giant system take the drastic step of bankruptcy.

Bankruptcy court: CalPERS pensions can be cut

The CalPERS' governing board during a meeting several years ago at the pension fund's headquarters. (Photo: CalPERS board)

by ED MENDEL posted 10.02.2014

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.

Pensions key to Stockton bankruptcy

Waterfront, Stockton, Calif., at Weber Point. (Photo: Terrance Emerson)

by ED MENDEL posted 09.17.2014

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.

Calpensions: A small but affluent Orange County city, with a current staff of only a half dozen employees, would have to pay about $3.6 million to leave CalPERS, the giant state pension system estimated two years ago. “I almost feel like just handing this to a reporter and saying, ‘Look at this.’

Merced County pensions may have the lowest funding level of any public pension system in California, a shortfall officials attribute to a big retroactive pension increase for all county employees a decade ago and faulty actuarial work. In the latest annual public pension report from the state controller’s office, Merced County stands out with the lowest level of funding in the last reported year, 54.7 percent in 2010-11.

OPINION: Ventura County citizens scored a victory earlier this month when a Superior Court Judge affirmed that any changes to the county pension plan must be made through the collective bargaining process — not at the ballot box. Actuarial analyses showed that closing the existing retirement plans and forcing new employees into risky 401k style plans would increase immediate costs to taxpayers, while forcing new employees to put their retirement security at risk in the hands of Wall Street.

Calpensions: Backers of a Ventura County pension reform initiative, which was removed from the November ballot recently by a judge last week, are not appealing the ruling. But they may meet with other reformers after the elections this fall to discuss a statewide pension reform initiative.

A bill that started out as Gov. Brown’s proposal to restructure the CalPERS board emerged from the Legislature last week as a more modest change: a requirement that CalPERS board members receive 24 hours of education in pension fund operations.

Payments seven judges make toward their pensions would be cut nearly in half by a bill approved last week in a Senate committee, despite a warning from the chairwoman of a “slippery slope” undermining the governor’s pension reform.

Can public pensions be cut in bankruptcy?

Bus stop in Stockton, Delta College. (Photo: San Joaquin RTD)

by ED MENDEL posted 06.09.2014

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.