San Bernardino, Calif., is moving toward a confirmation hearing in October after a somewhat bumpy hearing with the last creditor to object to the second-to-final stage, The Press-Enterprise reported yesterday. That penultimate stage is approval of the so-called disclosure statement, and most of the city’s creditors reached settlements with the city that require them to support the disclosure statement and confirmation of the adjustment plan. But attorneys for an organization called the Big Independent Cities Excess Pool (BICEP) took issue with the way they said BICEP was described in the disclosure statement. BICEP is a group of six mid-sized cities that pool coverage for liability claims, including an unknown number of civil-rights claims against San Bernardino that total more than $1 million. The city and BICEP disagree about how to handle those claims. The city’s filing included a section that it said was BICEP’s position word-for-word. BICEP’s objection “incurred the ire” of Bankruptcy Judge Meredith Jury. Franklin Adams, the attorney for BICEP, said there was a simple explanation: The city wasn’t telling the truth about the language being verbatim. Most of BICEP’s statement was included in the city’s, but it omitted a few sentences, said the city’s bankruptcy attorney, Paul Glassman. Judge Jury suggested that the city file the disclosure statement with the original language from BICEP, add a section explaining their disagreement, and work together with Adams to include a summary paragraph saying that there is a disagreement. A hearing on whether to confirm the bankruptcy plan was scheduled for Oct. 14. The city will mail ballots to creditors July 29 asking them whether they approve of the plan. Creditors will have until Sept. 2 to return those ballots.
