Bernstein-Burkley, P.C. Co-Managing Partner, Kirk B. Burkley, discussed Pennsylvania school distress laws in a recent Debtwire article. The article, “Red Lion Schools’ SOS tests Pennsylvania distress laws” covered the school district’s available legal solutions to its current financial issues.
From the article:
“While school distress in Pennsylvania continues to spread, the legislature’s mechanisms for alleviating financial hardship appear out of commission because state Democrats and Republicans can’t reach an agreement on the budget.
‘Without some special or specific authorization, schools cannot file for bankruptcy,’ said restructuring attorney Kirk Burkley of Bernstein-Burkley, PC. Burkley is co-managing partner at the firm.
Additionally, the restructuring expert doesn’t anticipate that schools will be able to enter financial recovery status under current law.
This is because of a subsection in Pennsylvania Act 141 stipulating that no school district ‘shall be declared in financial recovery status’ if its financial condition has been caused by the ‘failure of the commonwealth to make any payment of money due to the school district at the time the payment is due, including payment of any Federal Funding that is distributed through the commonwealth.'”
To read the full article, CLICK HERE.
