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
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.
ABI is the largest multi-disciplinary, nonpartisan organization dedicated to research and education on matters related to insolvency. ABI was founded in 1982 to provide Congress and the public with unbiased analysis of bankruptcy issues. The ABI membership includes over 13,000 attorneys, accountants, bankers, judges, professors, lenders, turnaround specialists and other bankruptcy professionals, providing a forum for the exchange of ideas and information. For additional information on ABI, visit www.abiworld.org. For additional conference information, visit http://www.abiworld.org/conferences.html.