Island Air employees have been told by a bankruptcy judge that there is no guarantee they will receive their final paychecks, the Associated Press reported. Bankruptcy Judge Robert Faris on Wednesday approved a motion to convert the bankruptcy case to a chapter 7 liquidation from a chapter 11 reorganization. Island Air ceased operations on Friday. The employees have not been paid for the work they did this month. CEO David Uchiyama said earlier this week that pay period encompasses about 10 days.
A task force delivered its final report on October 27 to Oregon Gov. Kate Brown on options to shrink the state’s bloated pension-fund deficit by $5 billion over the next five years, the Associated Press reported. Brown had convened the task force to identify opportunities to pay up to a quarter of the Public Employee Retirement System’s, or PERS, unfunded liability. That deficit has ballooned to at least $25.3 billion, according to a calculation released in September. The task force examined state assets, one-time revenue streams, and assets of other public employers that could be sold, bonded against or otherwise leveraged in order to cut the pension system’s unfunded actuarial liability. One option looked at several state-controlled entities that maintain substantial amounts of cash and short-term investments to cushion against financial downsides, and said the money could be pooled, with some transferred to PERS to reduce the deficit. “This ‘risk capital’ is rarely needed and may, in fact, never be drawn down.” the report said of the entities’ excess funds.
Public-sector workers in cash-strapped Hartford, Conn., are on edge as city officials have said the state capital could seek authority to file for bankruptcy as early as November, the Wall Street Journal reported today. State lawmakers, who are confronting their own two-year deficit of $3.5 billion, will have a big say in how that plays out. Legislative leaders say they reached a tentative state budget agreement that would give Hartford additional aid, and they expect to approve it this week. But after a series of false starts in the budgeting process, some are still uneasy. In early September, city officials warned Gov. Dannel Malloy and state lawmakers that Hartford wouldn’t be able to pay all of its bills within 60 days and could seek authority to file for chapter 9 bankruptcy in early November unless the legislature provided the city with more cash. Unions representing public employees say they are worried their members will be asked to make unreasonable sacrifices to fix Hartford’s financial problems even if the city doesn’t proceed with bankruptcy. Several municipal contracts have expired and need to be renegotiated.
