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San Bernardino Bankruptcy

San Bernardino Bankruptcy

Posted By Peter Rasla & Associates, P.L.C. || 25-Nov-2013

San Bernardino, a city located in Southern California, is currently in the process of a bankruptcy after having filed back in 2012. The city filed for Chapter 9 bankruptcy, also referred to as municipality bankruptcy. This form of bankruptcy is used for the reorganization of municipalities, such as cities, counties, school districts, etc.

This week they will enter into mediation with their creditors. They also have other plans for this week in regards to California Public Employees' Retirement System (Calpers) and the amount that they claim the city owes for pension arrears. The city is planning to dispute the amount that Calpers' claims they owe and they are also looking to have an extension on the amount of time that they have to pay their debt. In August of 2012, the city stopped paying on its employer contribution which is the first time that they have paid less than the full amount they owe.

The dispute has arisen due to the amount of the arrears. Calpers is saying the city owes $16.5 million, while San Bernardino is claiming the calculation is wrong and should be at 13 million. The city is planning to pay the arrears to the pensions and included their plan on the term sheet which was presented to the judge in October. Another California city filed for bankruptcy, but unlike San Bernardino, Stockton made all payments to Capers rather than including the pension fund in the bankruptcy.

San Bernardino has attempted to seek protection through Chapter 9 bankruptcy but this has been disputed by Calpers throughout the process. The current mediations are to last three days the Judge Gregg Zive will be mediating the process. Further details on the Chapter 9 bankruptcy can be found on the offices site of the City of San Bernardino. For representation in a bankruptcy case, call Peter Rasla & Associates, P.L.C.

Categories: Bankruptcy