A pension is an agreement between me and my employer to give me certain benefits after I retire. The pension fund, established by my employer to pay for my pension, doesn't really enter into it. Its existence is convenient for both of us to a certain extent, but it doesn't matter to me if the fund has a billion dollars or a million dollars. The boss still owes me what he promised either way.

The police pension funds work the same way. If the Minneapolis police pension fund was sued tomorrow and wiped out, the city still owes the police their pensions just the same as before. The money to pay those obligations has to come from somewhere. I suspect that it would come from the city.