Can NYC Go Bankrupt? Would It Impact Teacher Pensions and Health Benefits?
Every day Governor Cuomo has a press briefing, an update on the data: are the curves flattening? moving downward? and, muses about the political scene in Washington. Governors and mayors have been asking the feds for another infusion of dollars, this time to the states; after all, teachers, police, fireman, etc., are local and state employees. If you expect states and localities to take the lead in fighting the pandemic you have to support the efforts with federal dollars.
Mitch McConnell (Kentucky), the majority leader in the Senate, opposed any aid to states, states who didn’t have sufficient resources, McConnell crowed, should declare bankruptcy. Cuomo snapped back,federal law did not allow states to declare bankruptcy, and, New York State was the fifth biggest contributor to the feds and Kentucky 6th in contributing the least.
While federal law does not allow states to declare bankruptcies cities can: Chapter 9 of the Bankruptcy Law.
The New York Post added to concerns, “New York City is Edging Towards Financial Disaster, Experts Warn.”
A conservative website follows up on the NY Post article supporting the possibility of a New York City bankruptcy.
What is Chapter 9? It’s the portion of the federal bankruptcy code that applies to municipalities. Created by Congress in 1937, it allows municipalities to seek CONTINUE READING: Can NYC Go Bankrupt? Would It Impact Teacher Pensions and Health Benefits? | Ed In The Apple