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Default and Bankruptcy in the New Political Landscape  


Author:  Anne  Van Praagh.; Marc Levinson.; Michael H.  Goldstein.; Leon R.  Barson.; Stanley  McGuffin.


Source: Volume 32, Number 04, Winter 2012 , pp.81-100(20)




Municipal Finance Journal

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Abstract: 

The year 2010 was marked by widespread credit stress, with an increase in “near misses” and technical defaults but only a few rated defaults, despite predictions by some of a spate of defaults. This panel explores when a municipality may file for bankruptcy but not be in default, and when a municipality may default but not declare bankruptcy. It considers the Sierra Kings Healthcare District court ruling and its implications for bonds secured by special tax pledges and statutory liens, as well as the impact of Vallejo’s plans to exit bankruptcy in 2011, including payments and possible concessions to bondholders and other creditors. This article is based on the authors’ presentations in the panel on Default and Bankruptcy in the New Political Landscape conducted at the Twenty-Eighth Annual Conference of the National Federation of Municipal Analysts in Charleston, South Carolina, May 3–6, 2011.

Keywords: Chapter 9; Vallejo, California

Affiliations:  1: Moody’s Investors Service; 2: Orrick, Herrington & Sutcliffe LLP; 3: Greenberg Traurig, LLP; 4: Pepper Hamilton, LLP; 5: Haynsworth Sinkler Boyd, P.A..

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