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The Left Seeks End of Sex-Segregation Everywhere

The Left Seeks End of Sex-Segregation Everywhere

The Left Seeks End of Sex-Segregation Everywhere
Written By Laurie Higgins

A funny thing happened on the way to the following article getting published. After two pieces appeared in the Chicago Tribune mocking and maligning those who believe sex differences matter, I submitted an op-ed in which I express an opposing view. The associate editor of the Chicago Tribune’s Commentary section, Marcia Lythcott sent me this response:

I would love you to offer up an opposing viewpoint but you have submitted a rant. There is no way that this piece would make those on the fence say “Hmmm, that a really interesting viewpoint to consider.” I feel like you are jabbing the opposition in the eyes nonstop. Is it possible for you to do a rewrite, one that is less doctrinaire and reader-friendly? The point is to have as many readers as possible read a piece to the bitter end. I fear that many will stop reading your submission by the third paragraph. No one wants to be screamed at.

Readers can make their own judgments about the professionalism and accuracy of Lythcott’s eye-jabbing response, but before doing so, please take a few minutes to read the two pieces that prompted my op-ed, one by Rex Huppke and one by Mary Sanchez. See if their articles are less eye-jabbing, doctrinaire, ranting, and screaming than mine.

“The Left Seeks End of Sex-Segregation Everywhere”
Written by Laurie Higgins — First published on American Thinker

North Carolina’s attorney general recently announced that he would not fulfill his duty to defend a duly enacted law one of the purposes of which was to preserve the right of communities to require that restrooms correspond to biological sex rather than “gender identity.” Progressives are incensed by this type of legislation, which is proposed by conservatives in response to leftist actions in the service of their subversive beliefs about gender dysphoria. Progressives want any persons who wish they were the opposite sex to have unrestricted access to opposite-sex private areas, including restrooms, locker rooms, showers, dressing rooms and single-sex shelters. In the brave new progressive world, beliefs about the meaningfulness of objective, immutable physical embodiment as male or female must be subordinated to desires to be the opposite sex.

The left seeks to prohibit “discrimination” based on “gender identity” and “gender expression” in all contexts, including those areas that were created for the sole purpose of recognizing and accommodating objective, immutable sex differences. The prohibition of discrimination based on sex and the prohibition of discrimination based on “gender identity” and “gender expression” with regard to facilities in which private activities take place are wholly incompatible. The former permits society in some contexts to accommodate sex differences. The latter forbids society in any context from accommodating real, objective, immutable differences between men and women.

Some progressives dishonestly claim that conservatives are “obsessed” with so-called “bathroom bills,” when in reality it’s gender-dysphoric activists and their ideological allies who are obsessed with radically altering the cultural understanding of sex. They seek to mandate that sex-separated facilities, like restrooms, for private activities no longer correspond to the biological sex of humans but to the subjective feelings of humans about their sex.

Progressives ignore substantive conservative arguments. They recast arguments about the nature and meaning of sexual differentiation as bigotry; flippantly mock potential risks, particularly for girls and women; and wholly ignore the near universal understanding that separate facilities for men and women to engage in private activities exist because objective bodily differences exist and have meaning.

The concern of conservatives is not centrally about gender-dysphoric men assaulting women or girls — though that risk is not nil. The safety concern is, rather, that predators may exploit these policies, pretending to be gender-dysphoric in order to access women’s private facilities.

But even this is not the central concern. The central concern is with the meaning and value of physical embodiment from which feelings of modesty and desires for privacy derive.

In order to justify the injustice and irrationality of policies that force women and men to share private areas with persons of the opposite sex, the left resorts to unsound comparisons of gender dysphoria per se to race per se. Their error rests in the fact that while there are no intrinsic and meaningful differences between people of different races, there are intrinsic, substantive and meaningful differences between males and females, which both those who experience gender dysphoria and those who experience same-sex attraction implicitly acknowledge.

Here are some questions for progressives:

  • Why should gender-dysphoric persons not be compelled to use restrooms with those whose “gender identity” they don’t share while non-gender-dysphoric persons should be compelled to use restrooms with those whose actual sex they don’t share? Gender-dysphoric men claim that they want to use restrooms with only women, but what about actual women who want to use restrooms with only women? Why should the desires of men who wish they were women supersede the desires of objectively female persons?
  • If separate stalls provide sufficient privacy to separate gender-dysphoric men from women in private areas, then why don’t separate stalls provide sufficient privacy to separate gender-dysphoric men from non-gender-dysphoric men in men’s private areas? And if separate stalls provide sufficient privacy to separate gender-dysphoric men (who are objectively male) from women in restrooms, then why not make all restrooms to all persons regardless of their sex?
  • If objectively male persons who are uncomfortable with their male bodies are permitted in women’s private areas, why shouldn’t all men be permitted in there? What difference does it make to women if the man in the stall next to them likes his anatomy or not?
  • Once objectively male persons are allowed in women’s restrooms, on what basis would any man be prohibited from entering a women’s restroom? Wouldn’t prohibiting men from accessing women’s restrooms because they’re men constitute discrimination based on sex, and wouldn’t prohibiting them from accessing women’s restrooms because they’re not gender-dysphoric constitute discrimination based on “gender identity”?

While progressives are exalting subjective feelings, they should bear in mind that many men and women content with their respective maleness and femaleness have feelings too—feelings of modesty—which do not make them heartless, ignorant bigots no matter how many times those epithets are hurled at them.

Widespread embrace of leftist sexuality ideology, which is intrinsically self-contradictory, will ultimately result in the eradication of the public recognition of sex differences in all laws, policies and practices. It’s universal co-ed restrooms or else.

Source: Will County News

Fighting for a second chance

Should a teenage crime of desperation shackle an ex-offender for life? This is the question facing Illinois state politicians, who, due to a law they passed in 2011, must reckon with the likes of Lisa Creason, a 43-year-old mother from Decatur, Ill.

By all accounts, Lisa Creason is a respected member of her community. She’s mother to three children whose father was killed tragically in 2002 by a stray bullet. That spurred her to found a successful nonprofit combating youth violence, which joined with local churches and other nonprofits to form a chapter of CeaseFire in Decatur.

In 2012, Creason enrolled in nursing school with the hope of securing a better-paying job. She knew this was the key to moving her family out of her low-income neighborhood, which was plagued with gang violence.

When she graduated from nursing school, Creason called her mother in tears.

“I will never forget coming home from the school and calling my mom and telling her I passed the final. I’m done,” Creason said.

“I’m actually going to be able to buy my kids a home, [I thought]. I’m actually going to be able to afford to move my kids out of the ‘hood.”

But her optimism was short-lived. Less than a month after graduating with an associate degree in applied science in nursing from Richland Community College, Creason was denied the chance to clear the last hurdle to becoming a registered nurse: a state test granting her a license to practice.

Why? A crime she committed more than two decades ago.

A crime of survival leads to a scarlet letter

At age 19, Creason tried to steal money from a Subway cash register in Decatur because she needed to feed her daughter. At age 20, she was sentenced to three years in prison on attempted robbery and an unrelated burglary charge. She got out on work release a year later.

That conviction is now the only thing that stands between Creason and her dream.

In 2011, state lawmakers passed legislation adding “forcible felonies” to the list of crimes for which health care workers can be denied licenses to practice under the Health Care Worker Background Check Act. This crime classification includes attempted robbery, barring Creason and hundreds like her from licensure.

Creason’s situation is maddening. Though she can’t legally practice as a registered nurse, she has been working as a certified nursing assistant for a decade after obtaining a state waiver. But her earnings aren’t enough for Creason to be completely independent. She still relies on welfare programs to care for her two sons, as well as a teenage boy over whom she has custody.

“I just want to go to work as a nurse, take care of my kids and get off of government assistance,” Creason said. “That’s it.”

Her struggle was of little interest to the state.

“To be told after all we’ve been through that I wasn’t good enough … it was devastating,” she said.

“My nine-year-old didn’t have any idea of my criminal history, and I had to sit down with him and talk to him about that, because of all this. He didn’t understand.”

Fighting for a second chance

But state officials may have underestimated Creason’s determination.

A single mother of three children who founded a successful community organization, worked two jobs and attended classes part time, all in hopes of becoming a registered nurse, Creason can only be described as a force of nature.

When this unstoppable force hit the immovable object of the state, she pushed even harder.

Creason’s struggle took the form of Senate Bill 42. The bill would allow those with forcible felonies on their records (other than sexual offenses) to seek waivers from the state to obtain health care worker licenses, provided the convictions occurred more than five years prior to applying for a waiver. The Illinois Senate passed the bill on March 26.

The legislation now rests in the House Rules Committee and has 27 co-sponsors.

But nursing is just one occupation under which rehabilitated ex-offenders are severely restricted in Illinois. If an Illinoisan has a felony on her record, the state is permitted to deny her the license required to practice as an architect, athletic trainer, nail technician, barber and many other occupations. Given that nearly all of the tens of thousands of Illinoisans convicted of felonies every year will return to their communities at some point, these barriers pose a huge threat to successful reintegration.

The state must overhaul its occupational licensing rules, especially when it comes to ex-offenders in search of honest employment.

Illinois should also continue to expand the availability of record sealing. When a person’s criminal record is “sealed,” only law-enforcement agencies granting occupational licenses and parties with court orders are able to see someone’s criminal record. To get his or her record sealed, a qualifying offender must petition the court where the charges against him or her were brought and must supply that court with a variety of documents and information, including drug tests. For many ex-offenders, sealed records can mean the difference between gainful employment and reverting to bad habits.

Research shows that finding work is crucial to lowering the rate of recidivism among ex-offenders, which is important given that nearly 50 percent of ex-offenders in Illinois return to prison within three years.

Recidivism doesn’t come cheap. The Illinois Sentencing Policy Advisory Council, or SPAC, estimates one recidivism event costs an average of nearly $120,000, which is borne by taxpayers, the victim of the crime and the state economy as a whole.

Moreover, those Illinoisans who recidivate commit a large portion of all crimes in the state – individuals with no previous arrests made up a mere 11 percent of convictions in Illinois in 2013, according to SPAC.

For budgetary reasons, as well as for public safety and the sake of struggling ex-offenders and their families, rehabilitation should be the end goal of Illinois’ criminal-justice system. That means dismantling barriers to success for Decatur moms, Chicago dads and anyone in between who has made a bad choice in his or her past, but is ready and willing to move on.

“You should never give up on trying to move forward,” Creason said. “You should never accept being in poverty because officials feel like you shouldn’t be able to move forward.”


Austin Berg
Writer
P.S. If you’d like to support Lisa’s efforts, please call (844) 668-2945 today and ask your lawmaker to support Senate Bill 42.

Source: Will County News

Supreme Court Brings Back To Three-Fifths Slavery Formula for illegals

Supreme Court Brings Back To Three-Fifths Slavery Formula
By DICK MORRIS
Published on DickMorris.com on April 5, 2016

The Supreme Court decision in Evenwel v. Abbott, harkens back to how our original Constitution enshrined slavery in power until the Civil War.

The Evenwel decision holds that states may apportion districts — and presumably Congress can apportion Congressional representation — based on total population rather than based on those actually eligible to vote.  So now illegal immigrants, who cannot vote, are counted equally with voters in allocating legislative representation.

There is a terrible analogy between the Evenwel decision and the infamous three-fifths rule that was adopted to determine slave representation in the House of Representatives.

At the original Constitutional Convention, the northern and southern states wrangled over how to count slaves — who could not vote — in allocating congressional districts to the states.  The South wanted its voting power enhanced so slave states could come closer to a majority in the House of Representatives and have more electoral votes in choosing a president (electoral votes are allocated by adding the number of senators and congressmen from each state).

The northern states relented and agreed to count each slave as three-fifths of a person in apportioning legislative seats.  The South and the slave interest benefited enormously from the compromise.

So, as a result of the Supreme Court’s decision in Evenwel, illegal immigrants are to be the modern equivalent of slaves in proportioning representation in Congress.  Like slaves, these illegal immigrants cannot vote.  But they are now to be counted in determining how many seats in Congress each state gets.  These phantom voters have no more right to influence the composition of our Congress than the slaves did — unless and until they can vote.

As Gary Willis explains in his book Negro President: Jefferson and the Slave Power (2003), the distortions caused by the three-fifths rule permitted the slave power to remain in ascendency.  The Southern slave states had 47 House members in 1793 — under the three-fifths rule — while they should have had only 33.  By 1812, they had 76 but should have been entitled to only 59.  By 1833, they had 98 as opposed to the 73 they should have had.

Willis calls Jefferson the “Negro President” because it was the extra electoral votes that came from the three-fifths rule that let Jefferson eek past President John Adams in the electoral college in the election of 1800. In that contest, Jefferson won with 73 electoral votes to Adams’ 65.  But had the Electoral College votes only reflected vote eligible citizens, and excluded the three-fifths rule, Adams would have won.

This odious comparison illustrates the injustice of using illegal immigrants to apportion power but not giving them a voice in how it is used.  Either make them citizens and count their votes or leave them out of apportionment.

Source: Will County News

Chapter 9 Bankruptcy provides for reorganization of cities, counties, taxing districts, municipal utilities, & school districts

Chapter 9 – Bankruptcy Basics

This chapter of the Bankruptcy Code provides for reorganization of municipalities, which includes cities and towns, as well as villages, counties, taxing districts, municipal utilities, and school districts.

The first municipal bankruptcy legislation was enacted in 1934 during the Great Depression. Pub. L. No. 251, 48 Stat. 798 (1934). Although Congress took care to draft the legislation so as not to interfere with the sovereign powers of the states guaranteed by the Tenth Amendment to the Constitution, the Supreme Court held the 1934 Act unconstitutional as an improper interference with the sovereignty of the states. Ashton v. Cameron County Water Improvement Dist. No. 1, 298 U.S. 513, 532 (1936). Congress enacted a revised Municipal Bankruptcy Act in 1937, Pub. L. No. 302, 50 Stat. 653 (1937), which was upheld by the Supreme Court. United States v. Bekins, 304 U.S. 27, 54 (1938). The law has been amended several times since 1937. In the more than 60 years since Congress established a federal mechanism for the resolution of municipal debts, there have been fewer than 500 municipal bankruptcy petitions filed. Although chapter 9 cases are rare, a filing by a large municipality can— like the 1994 filing by Orange County, California—involve many millions of dollars in municipal debt.

Purpose of Municipal Bankruptcy

The purpose of chapter 9 is to provide a financially-distressed municipality protection from its creditors while it develops and negotiates a plan for adjusting its debts. Reorganization of the debts of a municipality is typically accomplished either by extending debt maturities, reducing the amount of principal or interest, or refinancing the debt by obtaining a new loan.

Although similar to other chapters in some respects, chapter 9 is significantly different in that there is no provision in the law for liquidation of the assets of the municipality and distribution of the proceeds to creditors. Such a liquidation or dissolution would undoubtedly violate the Tenth Amendment to the Constitution and the reservation to the states of sovereignty over their internal affairs. Indeed, due to the severe limitations placed upon the power of the bankruptcy court in chapter 9 cases (required by the Tenth Amendment and the Supreme Court’s decisions in cases upholding municipal bankruptcy legislation), the bankruptcy court generally is not as active in managing a municipal bankruptcy case as it is in corporate reorganizations under chapter 11. The functions of the bankruptcy court in chapter 9 cases are generally limited to approving the petition (if the debtor is eligible), confirming a plan of debt adjustment, and ensuring implementation of the plan. As a practical matter, however, the municipality may consent to have the court exercise jurisdiction in many of the traditional areas of court oversight in bankruptcy, in order to obtain the protection of court orders and eliminate the need for multiple forums to decide issues.

Eligibility

Only a “municipality” may file for relief under chapter 9. 11 U.S.C. § 109(c). The term “municipality” is defined in the Bankruptcy Code as a “political subdivision or public agency or instrumentality of a State.” 11 U.S.C. § 101(40). The definition is broad enough to include cities, counties, townships, school districts, and public improvement districts. It also includes revenue-producing bodies that provide services which are paid for by users rather than by general taxes, such as bridge authorities, highway authorities, and gas authorities.

Section 109(c) of the Bankruptcy Codes sets forth four additional eligibility requirements for chapter 9:

  1. the municipality must be specifically authorized to be a debtor by state law or by a governmental officer or organization empowered by State law to authorize the municipality to be a debtor;
  2. the municipality must be insolvent, as defined in 11 U.S.C. § 101(32)(C);
  3. the municipality must desire to effect a plan to adjust its debts; and
  4. the municipality must either:
    • obtain the agreement of creditors holding at least a majority in amount of the claims of each class that the debtor intends to impair under a plan in a case under chapter 9;
    • negotiate in good faith with creditors and fail to obtain the agreement of creditors holding at least a majority in amount of the claims of each class that the debtor intends to impair under a plan;
    • be unable to negotiate with creditors because such negotiation is impracticable; or
    • reasonably believe that a creditor may attempt to obtain a preference.

Commencement of the Case

Municipalities must voluntarily seek protection under the Bankruptcy Code. 11 U.S.C. §§ 303, 901(a). They may file a petition only under chapter 9. A case under chapter 9 concerning an unincorporated tax or special assessment district that does not have its own officials is commenced by the filing of a voluntary “petition under this chapter by such district’s governing authority or the board or body having authority to levy taxes or assessments to meet the obligations of such district.” 11 U.S.C. § 921(a).

A municipal debtor must file a list of creditors. 11 U.S.C. § 924. Normally, the debtor files the list of creditors with the petition. However, the bankruptcy court has discretion to fix a different time if the debtor is unable to prepare the list of creditors in the form and with the detail required by the Bankruptcy Rules at the time of filing. Fed. R. Bankr. P. 1007.

Assignment of Case to a Bankruptcy Judge

One significant difference between chapter 9 cases and cases filed under other chapters is that the clerk of court does not automatically assign the case to a particular judge. “The chief judge of the court of appeals for the circuit embracing the district in which the case is commenced [designates] the bankruptcy judge to conduct the case.” 11 U.S.C. § 921(b). This provision was designed to remove politics from the issue of which judge will preside over the chapter 9 case of a major municipality and to ensure that a municipal case will be handled by a judge who has the time and capability of doing so.

Notice of Case/ Objections/ Order for Relief

The Bankruptcy Code requires that notice be given of the commencement of the case and the order for relief. 11 U.S.C. § 923. The Bankruptcy Rules provide that the clerk, or such other person as the court may direct, is to give notice. Fed. R. Bankr. P. 2002(f). The notice must also be published “at least once a week for three successive weeks in at least one newspaper of general circulation published within the district in which the case is commenced, and in such other newspaper having a general circulation among bond dealers and bondholders as the court designates.” 11 U.S.C. § 923. The court typically enters an order designating who is to give and receive notice by mail and identifying the newspapers in which the additional notice is to be published. Fed. R. Bankr. P. 9007, 9008.

The Bankruptcy Code permits objections to the petition. 11 U.S.C. § 921(c). Typically, objections concern issues like whether negotiations have been conducted in good faith, whether the state has authorized the municipality to file, and whether the petition was filed in good faith. If an objection to the petition is filed, the court must hold a hearing on the objection. Id. The court may dismiss a petition if it determines that the debtor did not file the petition in good faith or that the petition does not meet the requirements of title 11. Id.

If the petition is not dismissed upon an objection, the Bankruptcy Code requires the court to order relief, allowing the case to proceed under chapter 9. 11 U.S.C. § 921(d).

Automatic Stay

The automatic stay of section 362 of the Bankruptcy Code is applicable in chapter 9 cases. 11 U.S.C. §§ 362(a), 901(a). The stay operates to stop all collection actions against the debtor and its property upon the filing of the petition. Additional automatic stay provisions are applicable in chapter 9 that prohibit actions against officers and inhabitants of the debtor if the action seeks to enforce a claim against the debtor. 11 U.S.C. § 922(a). Thus, the stay prohibits a creditor from bringing a mandamus action against an officer of a municipality on account of a prepetition debt. It also prohibits a creditor from bringing an action against an inhabitant of the debtor to enforce a lien on or arising out of taxes or assessments owed to the debtor.

Section 922(d) of title 11 limits the applicability of the stay. Under that section, a chapter 9 petition does not operate to stay application of pledged special revenues to payment of indebtedness secured by such revenues. Thus, an indenture trustee or other paying agent may apply pledged funds to payments coming due or distribute the pledged funds to bondholders without violating the automatic stay.

Proofs of Claim

In a chapter 9 case, the court fixes the time within which proofs of claim or interest may be filed. Fed. R. Bankr. P. 3003(c)(3). Many creditors may not be required to file a proof of claim in a chapter 9 case. For example, a proof of claim is deemed filed if it appears on the list of creditors filed by the debtor, unless the debt is listed as disputed, contingent, or unliquidated. 11 U.S.C. § 925. Thus, a creditor must file a proof of claim if the creditor’s claim appears on the list of creditors as disputed, contingent, or unliquidated.

Court’s Limited Power

Sections 903 and 904 of the Bankruptcy Code are designed to recognize the court’s limited power over operations of the debtor.

Section 904 limits the power of the bankruptcy court to “interfere with – (1) any of the political or governmental powers of the debtor; (2) any of the property or revenues of the debtor; or (3) the debtor’s use or enjoyment of any income-producing property” unless the debtor consents or the plan so provides. The provision makes it clear that the debtor’s day-to-day activities are not subject to court approval and that the debtor may borrow money without court authority. In addition, the court cannot appoint a trustee (except for limited purposes specified in 11 U.S.C. § 926(a)) and cannot convert the case to a liquidation proceeding.

The court also cannot interfere with the operations of the debtor or with the debtor’s use of its property and revenues. This is due, at least in part, to the fact that in a chapter 9 case, there is no property of the estate and thus no estate to administer. 11 U.S.C. § 902(1). Moreover, a chapter 9 debtor may employ professionals without court approval, and the only court review of fees is in the context of plan confirmation, when the court determines the reasonableness of the fees.

The restrictions imposed by 11 U.S.C. § 904 are necessary to ensure the constitutionality of chapter 9 and to avoid the possibility that the court might substitute its control over the political or governmental affairs or property of the debtor for that of the state and the elected officials of the municipality.

Similarly, 11 U.S.C. § 903 states that “chapter [9] does not limit or impair the power of a State to control, by legislation or otherwise, a municipality of or in such State in the exercise of the political or governmental powers of the municipality, including expenditures for such exercise,” with two exceptions – a state law prescribing a method of composition of municipal debt does not bind any non-consenting creditor, nor does any judgment entered under such state law bind a nonconsenting creditor.

Role of the U.S. trustee/bankruptcy administrator

In a chapter 9 case, the role of the U.S. trustee (or the bankruptcy administrator in North Carolina or Alabama) (1) is typically more limited than in chapter 11 cases. Although the U.S. trustee appoints a creditors’ committee, the U.S. trustee does not examine the debtor at a meeting of creditors (there is no meeting of creditors), does not have the authority to move for appointment of a trustee or examiner or for conversion of the case, and does not supervise the administration of the case. Further, the U.S. trustee does not monitor the financial operations of the debtor or review the fees of professionals retained in the case.

Role of Creditors

The role of creditors is more limited in chapter 9 than in other cases. There is no first meeting of creditors, and creditors may not propose competing plans. If certain requirements are met, the debtor’s plan is binding on dissenting creditors. The chapter 9 debtor has more freedom to operate without court-imposed restrictions.

In each chapter 9 case, however, there is a creditors’ committee that has powers and duties that are very similar to those of a committee in a chapter 11 case. These powers and duties include selecting and authorizing the employment of one or more attorneys, accountants, or other agents to represent the committee; consulting with the debtor concerning administration of the case; investigating the acts, conduct, assets, liabilities, and financial condition of the debtor; participating in the formulation of a plan; and performing such other services as are in the interest of those represented. 11 U.S.C. §§ 901(a), 1103.

Intervention/Right of Others to be Heard

When cities or counties file for relief under chapter 9, there may be a great deal of interest in the case from entities wanting to appear and be heard. The Bankruptcy Rules provide that “[t]he Secretary of the Treasury of the United States may, or if requested by the court shall, intervene in a chapter 9 case.” Fed. R. Bankr. P. 2018(c). Further, “[r]epresentatives of the state in which the debtor is located may intervene in a chapter 9 case.” Id. In addition, the Bankruptcy Code permits the Securities and Exchange Commission to appear and be heard on any issue and gives parties in interest the right to appear and be heard on any issue in a case. 11 U.S.C. §§ 901(a), 1109. Parties in interest include municipal employees, local residents, non-resident owners of real property, special tax payers, securities firms, and local banks.

Powers of the Debtor

Due to statutory limitations placed upon the power of the court in a municipal debt adjustment proceeding, the court is far less involved in the conduct of a municipal bankruptcy case (and in the operation of the municipal entity) while the debtor’s financial affairs are undergoing reorganization. The municipal debtor has broad powers to use its property, raise taxes, and make expenditures as it sees fit. It is also permitted to adjust burdensome non-debt contractual relationships under the power to reject executory contracts and unexpired leases, subject to court approval, and it has the same avoiding powers as other debtors. Municipalities may also reject collective bargaining agreements and retiree benefit plans without going through the usual procedures required in chapter 11 cases.

A municipality has authority to borrow money during a chapter 9 case as an administrative expense. 11 U.S.C. §§ 364, 901(a). This ability is important to the survival of a municipality that has exhausted all other resources. A chapter 9 municipality has the same power to obtain credit as it does outside of bankruptcy. The court does not have supervisory authority over the amount of debt the municipality incurs in its operation. The municipality may employ professionals without court approval, and the professional fees incurred are reviewed only within the context of plan confirmation.

Dismissal

As previously noted, the court may dismiss a chapter 9 petition, after notice and a hearing, if it concludes the debtor did not file the petition in good faith or if the petition does not meet the requirements of chapter 9. 11 U.S.C. § 921(c). The court may also dismiss the petition for cause, such as for lack of prosecution, unreasonable delay by the debtor that is prejudicial to creditors, failure to propose or confirm a plan within the time fixed by the court, material default by the debtor under a confirmed plan, or termination of a confirmed plan by reason of the occurrence of a condition specified in the plan. 11 U.S.C. § 930.

Treatment of Bondholders and Other Lenders

Different types of bonds receive different treatment in municipal bankruptcy cases. General obligation bonds are treated as general debt in the chapter 9 case. The municipality is not required to make payments of either principal or interest on account of such bonds during the case. The obligations created by general obligation bonds are subject to negotiation and possible restructuring under the plan of adjustment.

Special revenue bonds, by contrast, will continue to be secured and serviced during the pendency of the chapter 9 case through continuing application and payment of ongoing special revenues. 11 U.S.C. § 928. Holders of special revenue bonds can expect to receive payment on such bonds during the chapter 9 case if special revenues are available. The application of pledged special revenues to indebtedness secured by such revenues is not stayed as long as the pledge is consistent with 11 U.S.C. § 928 [§ 922(d) erroneously refers to § 927 rather than § 928], which ensures that a lien of special revenues is subordinate to the operating expenses of the project or system from which the revenues are derived. 11 U.S.C. § 922(d).

Bondholders generally do not have to worry about the threat of preference liability with respect to any prepetition payments on account of bonds or notes, whether special revenue or general obligations. Any transfer of the municipal debtor’s property to a noteholder or bondholder on account of a note or bond cannot be avoided as a preference, i.e., as an unauthorized payment to a creditor made while the debtor was insolvent. 11 U.S.C. § 926(b).

Plan for Adjustment of Debts

The Bankruptcy Code provides that the debtor must file a plan. 11 U.S.C. § 941. The plan must be filed with the petition or at such later time as the court fixes. There is no provision in chapter 9 allowing creditors or other parties in interest to file a plan. This limitation is required by the Supreme Court’s pronouncements in Ashton, 298 U.S. at 528, and Bekins, 304 U.S. at 51, which interpreted the Tenth Amendment as requiring that a municipality be left in control of its governmental affairs during a chapter 9 case. Neither creditors nor the court may control the affairs of a municipality indirectly through the mechanism of proposing a plan of adjustment of the municipality’s debts that would in effect determine the municipality’s future tax and spending decisions.

Confirmation Standards

The standards for plan confirmation in chapter 9 cases are a combination of the statutory requirements of 11 U.S.C. § 943(b) and those portions of 11 U.S.C. § 1129 (the chapter 11 confirmation standards) made applicable by 11 U.S.C. § 901(a). Section 943(b) lists seven general conditions required for confirmation of a plan. The court must confirm a plan if the following conditions are met:

  1. the plan complies with the provisions of title 11 made applicable by sections 103(e) and 901;
  2. the plan complies with the provisions of chapter 9;
  3. all amounts to be paid by the debtor or by any person for services or expenses in the case or incident to the plan have been fully disclosed and are reasonable;
  4. the debtor is not prohibited by law from taking any action necessary to carry out the plan;
  5. except to the extent that the holder of a particular claim has agreed to a different treatment of such claim, the plan provides that on the effective date of the plan, each holder of a claim of a kind specified in section 507(a)(1) will receive on account of such claim cash equal to the allowed amount of such claim;
  6. any regulatory or electoral approval necessary under applicable nonbankruptcy law in order to carry out any provision of the plan has been obtained, or such provision is expressly conditioned on such approval; and
  7. the plan is in the best interests of creditors and is feasible.

11 U.S.C. § 943(b).

Section 943(b)(1) requires as a condition for confirmation that the plan comply with the provisions of the Bankruptcy Code made applicable by sections 103(e) and 901(a) of the Bankruptcy Code. The most important of these for purposes of confirming a plan are those provisions of 11 U.S.C. § 1129 (i.e., § 1129(a)(2), (a)(3), (a)(6), (a)(8), (a)(10)) that are made applicable by 11 U.S.C. § 901(a). Section 1129(a)(8) requires, as a condition to confirmation, that the plan has been accepted by each class of claims or interests impaired under the plan. Therefore, if the plan proposes treatment for a class of creditors such that the class is impaired (i.e., the creditor’s legal, equitable, or contractual rights are altered), then that class’s acceptance is required. If the class is not impaired, then acceptance by that class is not required as a condition to confirmation. Under 11 U.S.C. § 1129(a)(10), the court may confirm the plan only if, should any class of claims be impaired under the plan, at least one impaired class has accepted the plan. If only one impaired class of creditors consents to the plan, plan confirmation is still possible under the “cram down” provisions of 11 U.S.C. § 1129(b). Under “cram down,” if all other requirements are met except the § 1129(a)(8) requirement that all classes either be unimpaired or have accepted the plan, then the plan is confirmable if it does not discriminate unfairly and is fair and equitable.

The requirement that the plan be in the “best interests of creditors” means something different under chapter 9 than under chapter 11. Under chapter 11, a plan is said to be in the “best interest of creditors” if creditors would receive as much under the plan as they would if the debtor were liquidated. 11 U.S.C. § 1129(a)(7)(A)(ii). Obviously, a different interpretation is needed in chapter 9 cases because a municipality’s assets cannot be liquidated to pay creditors. In the chapter 9 context, the “best interests of creditors” test has generally been interpreted to mean that the plan must be better than other alternatives available to the creditors. See 6 COLLIER ON BANKRUPTCY § 943.03[7] (15th ed. rev. 2005). Generally speaking, the alternative to chapter 9 is dismissal of the case, permitting every creditor to fend for itself. An interpretation of the ” best interests of creditors” test to require that the municipality devote all resources available to the repayment of creditors would appear to exceed the standard. The courts generally apply the test to require a reasonable effort by the municipal debtor that is a better alternative for its creditors than dismissal of the case. Id.

Parties in interest may object to confirmation, including creditors whose claims are affected by the plan, an organization of employees of the debtor, and other tax payers, as well as the Securities and Exchange Commission. 11 U.S.C. §§ 901(a), 943, 1109, 1128(b).

Discharge

A municipal debtor receives a discharge in a chapter 9 case after: (1) confirmation of the plan; (2) deposit by the debtor of any consideration to be distributed under the plan with the disbursing agent appointed by the court; and (3) a determination by the court that securities deposited with the disbursing agent will constitute valid legal obligations of the debtor and that any provision made to pay or secure payment of such obligations is valid. 11 U.S.C. § 944(b). Thus, the discharge is conditioned not only upon confirmation, but also upon deposit of the consideration to be distributed under the plan and a court determination of the validity of securities to be issued.

There are two exceptions to the discharge in chapter 9 cases. The first is for any debt excepted from discharge by the plan or order confirming the plan. The second is for a debt owed to an entity that, before confirmation of the plan, had neither notice nor actual knowledge of the case. 11 U.S.C. § 944(c).

At any time within 180 days after entry of the confirmation order, the court may, after notice and a hearing, revoke the order of confirmation if the order was procured by fraud. 11 U.S.C. §§ 901(a), 1144.


Notes

  1. In North Carolina and Alabama, bankruptcy administrators perform similar functions that United States trustees perform in the remaining forty-eight states. The bankruptcy administrator program is administered by the Administrative Office of the United States Courts, while the United States trustee program is administered by the Department of Justice. For purposes of this publication, references to United States trustees are also applicable to bankruptcy administrators.

http://www.bloomberg.com/news/articles/2015-02-05/detroit-pension-cuts-from-bankruptcy-prompt-cries-of-betrayal

Source: Will County News

Regulatory agencies are creating hidden taxes

dollar symbol among question marksRegulatory agencies have grown so out of control in the United States that they are referred to as the fourth branch of government. Yet, no one really knows just how much all the regulations created by those agencies cost taxpayers.

That’s why the Competitive Enterprise Institute is leading a push for Congress to include the regulatory budget proposed by House Budget Committee Chairman Tom Price (R-Ga.) in the government’s fiscal 2017 budget.

In a letter to lawmakers, the libertarian-leaning think tank said that the need for reform and transparency in regulatory costs is an urgent economic matter.

From the letter: “The government’s cost burden imposed on American families and businesses extends well beyond taxes, deficits, and borrowing. The country spends hundreds of billions of dollars each year on red tape. That’s a big drain on the economy, entrepreneurship and job creation. And, it is more than simply regulated businesses who pay the price. Just as firms pass on tax costs, firms also pass on regulatory compliance costs. This burden has not gone unnoticed, as the most recent edition of Gallup’s annual Governance survey found, 49 percent of Americans say the government regulates business too much, while 21 percent say it regulates too little, a near-low percentage.”

Price’s legislation would require the government to establish a list of annual costs of regulations and show a breakdown of where among the government’s agencies the costs originate.

George Washington University law professor Jonathan Turley testified before a House Judiciary subcommittee earlier this month in an effort to shine light on how far regulatory overreach has grown out of control.

He told lawmakers that regulatory agencies have essentially grown into a “fourth branch of government containing legislative, executive and judicial components but relatively little direct public influence.”

And as Reason pointed out: “It’s hard to argue with the numbers: In one recent year alone, Congress passed 138 laws—while federal agencies finalized 2,926 rules. Federal judges conduct about 95,000 trials a year, but federal agencies conduct nearly 1 million. Put all that together and you have a situation in which one branch of government, the executive, is arrogating to itself the powers of the other two.”

The Competitive Enterprise Institute views this as a sign that Congress needs to retake the power to legislate.

“With the recognition of the regulatory hidden tax alongside the budgetary one, we urge Congress to seize this unique opportunity to assert control over the regulatory state and enact significant reforms,” it said.

Source: Will County News