|Nov. 6, 2014
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Elections, Revenue and Taxation
Assembly, Senate, Elections, Federal
The Sacramento Bee reported on Wednesday that Moody’s Ratings had issued a statement citing Federal Bankruptcy Court Judge Christopher Klein’s decision last week in the Stockton bankruptcy case as “credit positive” for CalPERS. The Moody’s statement, Approval of Stockton Bankruptcy Exit Plan is Credit Positive for CalPERS, emphasizes the precedent setting nature of Judge Klein’s approval of Stockton’s Chapter 9 plan of adjustment. That plan protected the city’s pension benefits for its employees, which Moody’s says indicates that pensions “will enjoy better treatment than debt in California Chapter 9 cases. If Judge Klein had required the city to include cuts to pensions in the plan, it could have led to other municipalities seeking to reduce pension obligations through Chapter 9,” according to Moody’s.
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