LGC-affiliated risk pool hires bankruptcy lawyer but says it won’t file for bankruptcy
One of the risk pools operated by the former Local Government Center has hired a lawyer who specializes in bankruptcy proceedings, but the group said yesterday it will not file for bankruptcy.
In a letter to Property-Liability Trust members, Executive Director Peter Bragdon said the organization hired attorney Peter Baylor to help it “identify the best course of action” as it faces a Dec. 1 deadline to repay $17.1 million to its sister company, HealthTrust.
“Bankruptcy is not one of those solutions, and it is not being, nor will it be, considered,” Bragdon wrote in the letter.
The New Hampshire Union Leader reported Baylor’s hiring yesterday amid speculation from the state Bureau of Securities Regulation that the hiring of Baylor, a partner in the Boston law firm of Nutter McClennen & Fish, indicated the Property-Liability Trust was considering a bankruptcy filing.
Bragdon, also a state senator, wrote in his letter to members that the group simply wants to draw on Baylor’s “experience with debt restructuring and financial management.”
HealthTrust and Property-Liability Trust are public risk pools that provide insurance coverage to governments in New Hampshire.
Until Sept. 1 they were part of the Local Government Center, but the embattled organization’s latest reorganization sought to separate the risk pools and the New Hampshire Municipal Association.
However, all three still share a building in Concord, and Bragdon is executive director for both risk pools.
An August 2012 administrative hearing order, which the LGC has appealed to the state Supreme Court, ordered the organization to make changes to its corporate structure and business practices, including returning improperly retained surplus money to members.
It also required Property-Liability Trust to repay the HealthTrust $17.1 million by Dec. 1 this year.
Property-Liability Trust held net assets of less than $11.6 million at the
end of 2011, according to its most recent available annual report.
“Our number one priority is maintaining sufficient reserves to pay for all claims,” Bragdon wrote in yesterday’s letter.
(Ben Leubsdorf can be reached at 369-3307 or
firstname.lastname@example.org or on Twitter @BenLeubsdorf.)