Another California city considering bankruptcy

Pacific Grove CA may follow Vallejo in filing a Chapter 9 bankruptcy. A primary reason is that CalPERS, the state pension fund, is facing huge losses and can force public agencies like Pacific Grove to make up the difference.

A judge recently ruled that the Chapter 9 bankruptcy by Vallejo gives them the authority to break existing union contracts. They also want to get out of CalPERS.

The ongoing public pension trainwreck in California could get real ugly as law mandates the pensions be fully funded regardless. That money has to come from somewhere and there will be fury from those forced to pay more because the incompetently run CalPERS lost billions. Plus there’s the obvious possibility that such bankruptcies will be used as a cover for union-busting.

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