An attempt at mediation between state lawmakers and a Louisville mental health nonprofit over its bankruptcy has yielded little progress. Earlier this month, member of Seven Counties Services and a handful of state lawmakers met to discuss what, if any, deal could be reached over the nonprofit’s bankruptcy filing.
Under state law, Seven Counties is required to pay a larger share into its employees’ pensions than other types of pensions. The rising costs of those contributions, it claims, forced it into bankruptcy, and a federal judge ruled that it would not have to pay for its unfunded pension liabilities, estimated at about $90 million.
Greenville State Rep. Brent Yonts is part of an ad-hoc group of lawmakers trying to reach a deal Seven Counties.
“They at that moment in time did not come to the table with anything to offer,” said Yonts. “And I explained my viewpoint that in order to resolve this issue in the context of the bankruptcy, there had to be something that was negotiable other than saying ‘we can’t do anything.’”
Lawmakers are eager to reach a deal, however, because if the appeal rules in Seven Counties’ favor just like the lower court’s decision, it could set a precedent for similar quasi-governmental agencies, potentially leaving the state holding a $2.4 billion debt in unpaid liabilities should those agencies also jump the sinking ship.
The Office of Kentucky Governor Steve Beshear says President Barack Obama has authorized assistance for residents of seven Kentucky counties that suffered significant damage as a result of Friday’s tornadoes and severe storms.