San Bernardino bankruptcy shows how pensions crowd out services
By Wayne Lusvardi | Cal Watchdog
In his novel “The Sun Also Rises,” California novelist Ernest Hemingway wrote, “How do you go bankrupt? Two ways: Gradually, then suddenly.”
Case in point: the City of San Bernardino, which filed for bankruptcy in 2012. The pace of municipal bankruptcy there has been slow because in 2013 the city resumed making its pension fund payments to the California Public Employees Retirement System.
The city’s recently elected mayor, Carey Davis, has been telling CalPERS to stand in line with other creditors and be prepared to take a loss on its unpaid past pension payments. From August 2012 to July 2013, the city failed to make $17 million in payments to CalPERS, a sum the city now wants CalPERS to absorb.
at Cal Watchdog.