LOUISVILLE, Ky. (WHAS11)—A judge ruled on Friday that Seven Counties Services is eligible to file for Chapter 11 bankruptcy.
Judge Joan A. Lloyd ruled that the organization can file for Chapter 11 and also said that they were a non-governmental unit.
According to a press release from Seven Counties Services President and CEO Tony Zipple, being ruled a non-governmental unit allows them to remain in bankruptcy court and to pursue a plan on reorganization “to protect the business operations, including discharging any past or future obligation to the Kentucky Retirement System.”
They filed bankruptcy in April of 2013, according to the press release, “to protect the services and interest of our consumers by relieving us of the wholly unrealistic financial burden of the Kentucky Employees Retirement System.”
“$360,000 could provide a road to recovery for 514 more children and adults living with serious and persistent mental illness. $360,000 would give 100 more individuals with developmental disabilities the supports they need to gain and hold a job for a year; it could get 89 women with a substance abuse problems into evidence-based, proven therapies that would lead to addiction recovery, family reunification and sustained employment,” Zipple said.
Not everyone is happy about the ruling by Judge Lloyd, including Kentucky Government Retirees, who released a statement on the ruling.
“We are deeply disappointed that Seven Counties Services has been granted the authority to walk away from its pension obligation and further imperil the stability of the fragile Kentucky Employees Retirement System non-hazardous pension fund,” the statement from Jim Carroll, with the Kentucky Government Retirees, reads. “As stakeholders, we are counting on the Kentucky Retirement Systems board to appeal this ruling. Meanwhile, we are gratified that Governor Beshear and the General Assembly recently addressed the issue of escalating employer costs by enacting a biennial budget that provides supplemental employer pension funding for participating quasi-government agencies.”