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Jul 24, 2014

Bank settlements create windfall for US, and wrangling over how it is spent

NEW YORK, July 24 (Reuters) – U.S. authorities’ $8.9 billion
settlement last month with French bank BNP Paribas for sanctions
busting will pay for New York cops to get live computer feeds of
street crime and for new carpets in the offices of prosecutors,
among many other things.

In the past few months, American regulators and prosecutors
have forced some of the world’s largest banks to pay massive
fines for everything from breaching U.S. sanctions to alleged
mortgage abuse and illegal tax schemes.

Jul 17, 2014

Puerto Rico says commitment to honoring debt ‘unshaken’

NEW YORK, July 17 (Reuters) – Puerto Rico is fully committed
to honoring its debts and expects to be able to access capital
markets again possibly as soon as early 2015, officials of the
U.S. Commonwealth said during a conference call on Thursday.

The call was aimed at reassuring investors after Puerto Rico
passed a law allowing public corporations, such as electric
power authority PREPA, to restructure their debt. The law led to
a raft of debt downgrades and fears Puerto Rico may embark on
full-scale restructuring of its more than $70 billion debt.

Jun 27, 2014

Puerto Rico agency debt slumps as law fuels default fears

June 27 (Reuters) – Debt in some of Puerto Rico’s biggest
public corporations slumped in heavy trade on Friday after a new
law allowing them to restructure their debt sparked ratings
downgrades and fears of imminent default.

The rapid turn of events that started with the announcement
of the law on Wednesday led to a sustained bout of selling in
the debt of the U.S. Commonwealth’s electricity, highway and
water authorities.

Jun 10, 2014

Puerto Rico may delay payments to beat $320 mln tax shortfall

NEW YORK, June 10 (Reuters) – Puerto Rico may reschedule
payments to the Government Development Bank as well as the
pension system for central government employees as it aims to
reduce a $320 million tax revenue shortfall by the end of the
fiscal year on June 30, the U.S. Commonwealth said on Tuesday.

The government said it is considering restructuring about
$250 million in payments to the GDB and $90 million to the
Central Government Employees Retirement Systems Administration.
It may also use a $35 million surplus from a 2009 sale of sales
tax bonds to plug the gap, it said.

Jun 6, 2014

Starved muni market awaits $850 mln New York City debt sale

NEW YORK, June 6 (Reuters) – New York’s Mayor Bill de Blasio
has little to fear from bond vigilantes when the city goes to
market next week with an $850 million general obligation
refinancing deal, the city’s first bond deal since the mayor
inked a multibillion dollar deal with city labor unions in May.

A scarcity of new bonds and a reach for yield in the $4
trillion municipal bond market this year mean the city’s debt
will likely get a good reception, allowing de Blasio to press
ahead with his big-ticket, progressive agenda without fear of
investors punishing him with higher borrowing costs.

May 30, 2014

Oklahoma scales back pension plan for some new state workers

NEW YORK, May 30 (Reuters) – Oklahoma’s Republican Governor
Mary Fallin has signed legislation that scraps defined-benefit
pension plans for some incoming state workers, offering them
plans favored in the private sector that shift the risk of
retirement saving onto employees.

State pension systems are the last holdout of traditional
defined benefit plans in the United States. Many of the plans,
which offer a guaranteed income stream on retirement, are
severely underfunded due to the 2008-2009 financial crisis and
years of mismanagement when state authorities did not make
required contributions.

May 16, 2014

Analysis – New York’s pension ‘smoothing’ may short-change retirement fund

NEW YORK (Reuters) – New Yorkers who rely on the state pension fund for their retirement may be short-changed about $735 million over the next 10 years as a result of Governor Andrew Cuomo’s policy of permitting local authorities to defer fund payments so they can fill budget gaps and pay for services such as schools, street lights and police.

Cuomo has been trying to rid New York of its reputation as a high-tax state and has put limits on tax increases by local governments, reducing their ability to meet their often rising obligations. The smoothing policy is intended to make it easier for them to raise money without raising taxes.

May 16, 2014

New York’s pension ‘smoothing’ may short-change retirement fund

NEW YORK (Reuters) – New Yorkers who rely on the state pension fund for their retirement may be short-changed about $735 million over the next 10 years as a result of Governor Andrew Cuomo’s policy of permitting local authorities to defer fund payments so they can fill budget gaps and pay for services such as schools, street lights and police.

Cuomo has been trying to rid New York of its reputation as a high-tax state and has put limits on tax increases by local governments, reducing their ability to meet their often rising obligations. The smoothing policy is intended to make it easier for them to raise money without raising taxes.

Apr 17, 2014

New York’s transit authority cuts deal to end 2-year pay dispute

NEW YORK (Reuters) – New York’s Metropolitan Transportation Authority (MTA) struck a deal on Thursday to end a 2-year pay dispute with a more generous offer to workers than the years of pay freezes it had originally proposed, New York state Governor Andrew Cuomo said.

The MTA, a state-run agency, had previously insisted on 3 years of pay freezes, but the new deal struck with the help of the governor’s office, which is eager to avoid a strike in an election year, offered an 8 percent pay rise over 5 years.

Apr 14, 2014

New York finalizes $8 bln Medicaid accord with federal government

NEW YORK, April 14 (Reuters) – New York State said it
finalized an agreement with the U.S. government on Monday
allowing it to reinvest $8 billion of federal money in its
health insurance system for low income people while avoiding
potentially painful cuts or additional budget strain.

Over the next five years, the state will keep the federal
savings it makes by reforming its existing Medicaid program.
The savings, slated to total more than $17 billion by the end of
the 2014-2015 financial year, were identified by a group
established in 2011 by New York Governor Andrew Cuomo.

    • About Edward

      "Ed Krudy leads a team covering the U.S. equity market from New York, where he has been since 2009. Prior to that he set up Thomson's new bureau in Budapest, where he initiated coverage of economic, political, market and company news."
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