Skip to comments.CalPERS objects to bankruptcy filing by San Bernardino, which owes pension fund millions
Posted on 10/25/2012 9:16:19 AM PDT by SmithL
After getting stiffed by the city of San Bernardino for millions in payments, CalPERS is objecting to the city's right to file for bankruptcy protection.
In a lengthy court filing late Wednesday, the California Public Employees' Retirement System suggested San Bernardino is using bankruptcy protection to avoid paying its debts. The city owes CalPERS about $5.2 million.
The city's action "raises a serious question of whether its underlying purpose has been merely to 'buy time' and 'evade creditors,'" CalPERS wrote in a filing in U.S. Bankruptcy Court in Riverside.
(Excerpt) Read more at sacbee.com ...
“bankruptcy to avoid paying creditors?” Ain’t that what bankruptcy has always been?
“Aint that what bankruptcy has always been?”
Popcorn, gotta break out the popcorn.
And now it wants special privileges in the bankruptcies that are coming???
Can you say "audacious hypocrisy"???
The welling point with municipal bonds has always been as a safe investment, and in return for a safer investment you would accept a lower rate of return.
The investors do have a legit grip, in that the city probably took advantage of paying a lower rate, and is now breaking the deal.
And, after all, what does bankruptcy mean for a city? For a private firm it means they sell their assets and the investors lose their money? But, would a city have to sell assets in bankruptcy; would citizens lose their investment in the city?
The long term effect of this is that states, counties, and cities across the country will have a harder time selling bonds, and will have to pay higher interest rates.
I would buy this complaint from Calpers
if years ago Calpers had been sold off, allowed to continue as a pension plan, and just one among many private pension plans, that Valifornia goverment employees could chose to have their pension contributions placed in
but that is not Calpers - and an employee of any governmental unit in Kalifornia does not have a choice of where - whose pension plan - their employee and employer pension contributions ought to be sent to, and nearly all pensions of governmental units in California wind up being controlled by or invested in Calpers one where or another; meaning Calpers is the pension giant it is because it is a government monopoly in California
and I am never sorry for any government monopoly, no matter the circumstances
in as much as Calpers is the socialist style big government monoply that it is, I suggest it do what big government monopolies do - rob from Peter to pay Paul, from somewhere in all Calpers billions, and help rescue San Bernardino instead of telling it to dig its hole deeper for Calpers sake.
CalPERS says its much more complex than bankruptcy ~ that the retirement funding situation has to be dealt with. I suppose CalPERS could simply refund the deposits and drop the obligations to retirees, but that’ll take action by a court.
As a school district employee, I am required to be a part of CalPERS - about 7% of my gross pay goes toward my retirement every month. That being said, I am fully in support of San Bernardino being able to eliminate their debt to CalPERS in bankruptcy - as long as all of the city employees, past and future, all lose any benefits from CalPERS going forward. I don’t see why the money I am paying into CalPERS for my future retirement should go to support retirees from an agency or city that has refused to pay into the system for their employees.
They can be parceled out and sold. There are investors interested in such things ~ for instance, the people receieving sewer service would invest in an ownership vehicle for those lines.
I object to your being broke! You aren’t allowed to be broke!
Say what you will about how unrealistic and bad ATLAS SHRUGGED was in some ways, she still squarely pegged the bad guys.
If the victim (loosely speaking) decides it doesn’t want to participate in being looting (’victim’ in this case being a lesser looter) any more, why the whole thing could crumble.
Wait till the County’s start on that road. If they are “charter counties” they are incorporated and can fiel for bankruptcy. However, “general counties” are a subdivision of the state and their debt would default to the state.
Why not? The city possesses vehicles, land and buildings. The city offices and shops have tools, radios, computers. Plenty of assets to sell off to pay bond holders. Downsize to the bare minimum necessary.