Timeliner - Spending Stories - US City Bankruptcies
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Vallejo votes to declare Chapter 9 bankruptcy2008-05-06Vallejo Votes to Declare Chapter 9 BankruptcyThe Vallejo City Council voted to declare bankruptcy Tuesday night after months of last-ditch wrangling failed to rescue the city from financial catastrophe.

The North Bay city of 117,000 now heads into largely uncharted territory, as no California city of this size has ever opted for this route.

....

After about four hours of discussion and public comment from the standing-room-only crowd, the council voted 7-0 to approve Tanner's recommendation to declare Chapter 9 bankruptcy protection as a means to reorganize its finances, which have been shattered by spiraling public employee salaries and the plummeting housing market.

The move allows the city to freeze its debts while maintaining city services. Police, fire and other unions and many in the audience were outraged at the move, accusing the council of poor leadership.

...

Vallejo faces a $16 million shortfall and no money in its reserve account for the fiscal year beginning July 1. In March, the city shaved several million dollars from its payroll, museums, public works, senior centers, libraries and other services to avoid bankruptcy, but needed to make further cuts to meet increased expenses in the next fiscal year.

...

The city and its public safety unions have been at the bargaining table for about two years. The city is asking for its police and firefighters to take salary, benefit and staff cuts, while the unions say any further cuts would endanger public safety as well as the safety of the police and firefighters.

Vallejo spends 74 percent of its $80 million general fund budget on public safety salaries, significantly higher than the state average. The generous contracts are the result of deals struck in the 1970s, following a police strike that left the city in turmoil.
http://ww2.hdnux.com/photos/07/55/07/2019793/5/628x471.jpgSan Francisco Chroniclehttp://www.sfgate.com/bayarea/article/Vallejo-votes-to-declare-Chapter-9-bankruptcy-3285168.phpVallejo, California38.1,-122.2
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Prichard Alabama Declares Bankruptcy for second time in 10 Years2009-10-28Prichard files for bankruptcy; city faces lawsuit over nearly empty pension fundThe city of Prichard filed for bankruptcy Tuesday in an attempt to cope with the debt created by fighting lawsuits and addressing the demands of unpaid and agitated retired city employees. The Chapter 9 filing marks the second time in a decade that the city declared it was out of money. Mayor Ron Davis, who just two years ago helped the city pay off its creditors from the 1999 bankruptcy, blamed the latest financial crisis in part on a flawed municipal pension plan. The filing came a day before Davis and the city Finance Director Rex Williams were slated to be deposed by attorneys representing the pensioners in a lawsuit filed in August. With the filing, that testimony will be put on hold, along with any other litigation pending against the city.http://graphics8.nytimes.com/images/2010/12/23/business/Prichard2/Prichard2-articleLarge.jpgMobile Press Registerhttp://blog.al.com/live/2009/10/prichard_files_for_bankruptcy_1.htmlPrichard, Alabama30.7395363,-88.0740632
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Boise County, Idaho files for Bankruptcy2011-03-02Small Idaho County Files for BankruptcyBoise County, Idaho, has filed for municipal bankruptcy protection, but not because of falling tax revenue, rising spending, unfunded pension obligations or any of the other problems that have raised concern about city and county finances nationwide.

The small, rural county—which, despite its name, isn't home to the capital city of Boise—sought protection from its creditors this week because of an inability to pay a multimillion-dollar judgment against it, County Commissioner Robert A. Fry said.
http://www.boisecounty.us/Content/Site101/Basics/Elkinbackyardjp_00000006303.jpgWall Street Journalhttp://online.wsj.com/news/articles/SB10001424052748704005404576176841523443046Boise County, Idaho#N/A
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Central Falls, Rhode Island2011-08-07Central Falls bankruptcy means a grim present for the 'city with a bright future'Central Falls in Rhode Island bills itself as "a city with a bright future". Its present looks grim. The tiny city of 18,000 people claims to be the smallest, most densely populated in the US. Now it has another claim to fame: Central Falls is the first city in the state to go bankrupt. It is unlikely to be the last.http://static.guim.co.uk/sys-images/Guardian/Pix/pictures/2011/8/7/1312741750740/Central-Falls-Rhode-Islan-007.jpgGuardianhttp://www.theguardian.com/business/2011/aug/07/central-falls-bankruptcy-cityCentral Falls, Rhode Island#N/A
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Pennsylvania capital Harrisburg files for Bankruptcy2011-10-13Pennsylvania capital Harrisburg files for bankruptcyThe US city of Harrisburg - capital of the state of Pennsylvania - has filed for bankruptcy, a move quickly opposed by the city's mayor.

Harrisburg faces debts of $300m (£190m) and has struggled to pay for services.

The move comes as the state legislature considers a takeover of the city and the implementation of a "rescue plan".

Last year, municipal bond analysts expected many bankruptcies from cities under debt pressure, but few localities have actually taken the step.

The city council voted 4-3 on Wednesday to file for bankruptcy under a rarely used code for towns and cities.
http://news.bbcimg.co.uk/media/images/56005000/jpg/_56005565_013140113-1.jpgBBChttp://www.bbc.co.uk/news/world-us-canada-15283148Harrisburg, Pennsylvania#N/A
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Jefferson County, Alabama files for Bankruptcy, Largest in US History2011-11-09Jefferson County in Alabama faces bankruptcyLeaders of the largest county in the US state of Alabama have voted to file for a $4.1bn (£2.6bn) bankruptcy, the costliest US municipal failure ever.

Jefferson County has been struggling to avoid bankruptcy since 2008, but recent talks on a deal to restructure its crippling debt broke down.

The county sunk into debt after a costly upgrade of its sewer system.

Jefferson County has about 658,000 residents and is home to Alabama's largest city, Birmingham.

The bankruptcy was approved by the Jefferson County Commission by a 4-1 vote.

Announcing the vote result, Commissioner Jimmie Stephens said filing for bankruptcy would not radically change the situation in the county.

"Jefferson County has, in effect, been in bankruptcy for three years," he told the Associated Press.
http://i.huffpost.com/gen/402129/thumbs/r-JEFFERSON-COUNTY-BANKRUPTCY-large570.jpgBBChttp://www.bbc.co.uk/news/world-us-canada-15668788Jefferson County, Alabama#N/A
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Stockton, California2012-06-27Californian city of Stockton files for bankruptcyThe Californian city of Stockton has become the largest US city in decades to file for bankruptcy, after failing to make a deal with its creditors.

Mayor Ann Johnston told the city council the move was "the most heart-wrenching decision" they had faced.

Stockton faces a projected $26m (£17m) budget shortfall.

The river port city of 290,000 - which lies 90 miles (144km) east of San Francisco - suffered badly during the US housing market crash.

Filing for Chapter 9 bankruptcy protection allows the city to hold some of its creditors at bay while still paying for basic services like its police and fire department.

...

It is the largest US city to go bust since Cleveland, Ohio did so in 1979.
http://frontpagemag.com/wp-content/uploads/2013/04/ap_stockton_bankruptcy_nt_120625_wg-450x298.jpgBBChttp://www.bbc.co.uk/news/world-us-canada-18605326Stockton, California37.95,-121.29
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California city of Mammoth Lakes votes for Bankruptcy2012-07-03Mammoth Lakes becomes second bankrupt Californian townThe ski resort town of Mammoth Lakes has voted to become the second California local government to file for bankruptcy.

The town of 8,000 in the Sierra Nevada mountains is facing a bill of $43m (£28m) for a botched development agreement more than twice its budget.

Mammoth Lakes also faces a deficit in its general fund of up to $2.5m.
http://ww1.hdnux.com/photos/14/02/61/3157116/3/628x471.jpgBBChttp://www.bbc.co.uk/news/world-us-canada-1869365037.615,-119.0
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San Bernardino, California2012-08-02San Bernardino in California files for bankruptcyThe California city of San Bernardino has filed for bankruptcy protection amid a $46m (£30m) budget deficit and ongoing criminal investigations.

The city listed assets and debts of over $1bn, court documents show, and becomes the third in the state to go bust in just over one month.

Mayor Patrick Morris said San Bernardino filed for Chapter 9 to avoid legal action from creditors.
http://www.sott.net/image/image/s5/108318/medium/1.jpgBBChttp://www.bbc.co.uk/news/world-us-canada-19089970San Bernardino, California34.12,-117.32
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Detroit files for Bankruptcy2013-07-13Detroit Files for BankruptcySinking under huge debts and decades of mismanagement, Detroit formally filed for bankruptcy on Thursday, becoming the biggest US city ever to take such a drastic measure.

Kevyn Orr, Detroit's emergency manager, took the decision after failing to broker a deal between the city's bondholders and its pension funds.

The filing sets a new record for municipal bankruptcies and dwarfs the previous record filings by Jefferson County, Alabama, and Stockton, California. No other city of Detroit's size has ever gone bust.

Orr and the city's creditors and pensioners will now begin a fraught legal consultation period while a court determines whether the city is eligible for "chapter 9" bankruptcy protection for its $18.5bn debts and liabilities.

In a letter posted with the filing, the Michigan governor Richard Snyder confirmed he had received Orr's request to start the bankruptcy proceedings. He said it was "clear that the financial emergency in Detroit cannot be successfully addressed outside of such a filing, and it is the only reasonable alternative that is available."
http://news.bbcimg.co.uk/media/images/68845000/jpg/_68845345_68845344.jpgGuardianhttp://www.theguardian.com/world/2013/jul/18/detroit-formally-files-bankruptcy42.3486635, -83.0567375
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