Allowing States to File for Bankruptcy Is Not a Practical Way to Reduce Unfunded Pension Obligations According to Latest ABI Quick Poll
Allowing States to File for Bankruptcy Is Not a Practical Way to Reduce Unfunded Pension Obligations According to Latest ABI Quick Poll
Contact: John Hartgen
703-894-5935
[email protected]
ALLOWING STATES TO FILE FOR BANKRUPTCY IS NOT A PRACTICAL WAY TO REDUCE UNFUNDED PENSION OBLIGATIONS, ACCORDING TO LATEST ABI QUICK POLL
April 20, 2011, Alexandria, Va.— A majority of
respondents (53 percent) in a recent ABI Quick Poll thought that a new
bankruptcy chapter for states would not be a practical way for a
financially distressed state to reduce its unfunded pension obligations.
States are currently not permitted to file for bankruptcy despite
projected deficits totaling $112 billion in the next fiscal year, being
weighed down in part by unfunded pension obligations.
Congress has focused on a proposal by former Speaker of the House Newt
Gingrich calling for a new bankruptcy chapter to be added to the
Bankruptcy Code to help financially distressed states. Though hearings
continue to be held, the proposal of a new bankruptcy chapter for states
has received heavy criticism from congressional lawmakers and
governors.
Forty percent of respondents thought that a new bankruptcy chapter for
states would be a practical way for distressed states to reduce unfunded
pension obligations. Four percent did not know or had no opinion on the
poll question.
ABI’s Quick Poll is posted on ABI’s home page, www.abiworld.org. ABI members and
the public are invited to respond to a question on a timely bankruptcy
or insolvency issue. Visit http://www.abiworld.net/quickpoll/
to access the results of previous ABI Quick Polls.
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dedicated to research and education on matters related to insolvency.
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