How City Bankruptcy Benefits Pacific Grove Residents
by John M. Moore for Pacific Grove Taxpayers Association
How could Pacific Grove’s Pension payout improve if City files for Chapter 9 Municipal Bankruptcy ?
What follows is my analysis and opinion of the payout the City should request in its proposed Chapter 9 Plan (Municipal Bankruptcy under Federal law), for both current Pacific Grove retirees and for those who have worked for Pacific Grove and are not yet retired.
100 Million Needed
Pacific Grove’s Pension plan is supposed to have about 100 million dollars in it.
Only 42 Million Available
Based on the Calpers 2010 estimate, I believe the City’ Pension plan has a current deficit of about 40 million dollars.
In addition the City owes about $18 million in principal for the 2006 pension bonds, for a total deficit of $58 million, leaving a net of 42 million dollars to pay for 100 million dollars of pension promises.
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