WHEN ORGANIZATIONS DON’T MEET PENSION OBLIGATIONS

By Staff

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December 13, 2019

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Ever wonder what happens when you can’t pay your pension obligations? We’ve talked about that issue frequently on the Commonwealth Minute, but a recent example hits close to home. McClatchy news group, which owns newspapers across the nation, including the Lexington Herald-Leader, saw its stock crash after it announced it won’t be able to pay its pension obligations in 2020. McClatchy stocks tumbled from $1.41/share to 49 cents. Barring a miracle, McClatchy won’t be able to pay its $124 million pension obligations in 2020. Now consider that Kentucky has around a $42 billion pension shortfall—the worst in the nation according to Wallstreet 24/7. Altogether, 372,524 retired and active employees depend on it.  Pension reform is sure to be debated in the 2020 General Assembly session which begins next month.

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