CALIFORNIA
Check out the new California section

Topics

Bankruptcy
Cities may use bankruptcy to cut worker pensions
Cities may use bankruptcy to cut worker pensions

Financially pressed California cities might turn to bankruptcy as a way to cut their increasing pension costs after a judge's ruling, experts said Thursday. Analysts from Moody's Investor Services, a bond rating firm, said that Wednesday's ruling by a federal judge considering Stockton's bankruptcy case could open the door for cities to cut retirement obligations — once considered sacrosanct. In that ruling, Judge Christopher Klein said cities could walk away from their pension obligations — just as they can from other debts. The ruling was lambasted by the California Public Employees' Retirement System, which provides pension benefits to 1.7 million...

Loading