Negotiations between the bankrupt city of San Bernardino, Calif., and the state's public pension fund over the unprecedented suspension of pension payments by the city have failed to produce an agreement before a crucial court hearing, Reuters reported yesterday. Senior officials at the California Public Employees Retirement System, the largest U.S. public pension fund and San Bernardino's biggest creditor, have met with city budget officials and held telephone conversations with the city's mayor over the past several weeks. CalPERS said that San Bernardino still has not provided crucial financial information, or proposed a plan for resuming its twice-monthly, $1.2 million payments to the fund. The judge overseeing San Bernardino's request for bankruptcy protection told the city in December that it must provide more financial information to its creditors. CalPERS says that its efforts to help the city produce the information have not been as productive as it expected, but still hopes something can come from negotiations before the next court hearing on Tuesday.
For more on municipal financial distress and chapter 9 trends, be sure to pick up a copy of Municipalities in Peril: The ABI Guide to Chapter 9, Second Edition.