Actually, best to divide it into three parts:
1. Accrued liability for which there are assets in the pension funds. These are not even the subject of the bankruptcy by the most aggressive creditor's wildest imagination.
2. Accrued liability for which there are not assets in the pensions. In the Millender and other reports, these were called "UAL" -- unfunded accrued liability. This is where Section 24 of the Michigan Constitution and federal bankruptcy law may conflict. I think you could break this category into two sections, one for retirees and one for active employees, but there may not be a distinction there, depending on the terms of the funds.
3. Unaccrued liability--for current employees who are not vested. This is likely to go away. Based on what I've read, I would imagine the pension funds would be frozen.
Yes, more precise language is always helpful.
Bookmarks