From the San Francisco Chronicle: : After desperately trying everything from huge budget cuts to secret negotiations with creditors, the Stockton City Council finally ran out of options Tuesday night and voted to file for bankruptcy.
6-1 vote was to authorize a day-to-day operating budget, called a
pendency plan, that will go into effect when city officials file for
Chapter 9 bankruptcy protection in federal court in Sacramento. That
filing is expected Wednesday.
Stockton, a river port with 292,000
residents, will become the biggest city in U.S. history to vote itself
into bankruptcy. The previous largest bankrupt city was Vallejo, which
filed in 2008 and resumed solvency last year.
A federal judge will
now be charged with deciding how much money on the dollar Stockton will
pay creditors and how the city will restructure its budgets in
Bankruptcy became the only option after the city
failed to erase a $26 million deficit or to renegotiate millions of
dollars it owes in retiree health benefits and on huge civic projects it
built in the past decade.
Stockton is the latest, but North Las Vegas should follow in their footsteps. Not only North Las Vegas, but cities like Detroit and other large cities should also consider bankruptcy to get out of burdonsome union contracts.
One reason why Stockton is in trouble: Before the vote, retired police Officer Nicholas Huerta,
57, summed up the feelings of his fellow retirees and said he won't be
able to afford his medical insurance if the city reduces its $1,500
So the guy is not only receiving a pension of a few thousand dollars a month but he gets $1500 in health benefits? That's more most single people get charged per month.
So, good luck to Stockton and I hope other cities do the same.
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