View Full Version : Now Three California Cities Are Bankrupt

12-07-2012, 12:53 PM
It's mostly pensions at 120% of normal wages at time of requirement and unions forcing $60/hr wages and more than $50/hr perks.

Just remember that California is the 9th largest economy in the world, far outpacing most countries that are considered wealthy. :illogical

So far, well - read it fer yerselves:::

A San Bernardino filing would follow Stockton, a community of 292,000 east of San Francisco, which on June 28 became the biggest U.S. city to go into bankruptcy. Mammoth Lakes, a mountain resort of 8,200, filed for protection from creditors on July 3 saying it can’t afford to pay a $43 million judgment, more than twice its general-fund spending for the year.

The Chapter 9 filing would allow the city to suspend payments to creditors while it seeks court approval for a plan that balances its revenue with its debt. Travis-Miller said a filing could take a month to prepare.

Confronting a $45 million budget shortfall, San Bernardino is facing insolvency because of accounting errors, deficit spending, pension and debt costs, and lack of revenue growth, according to a June 26 budget analysis posted on the city’s website. Officials have declared fiscal emergencies, negotiated for concessions from employees and reduced the workforce by 20 percent in four years.

‘Life Support’

“Reorganization may be the only way to keep the city of San Bernardino on life support,” said Wendy McCammack, one of the seven council members. “This is the hardest decision this councilwoman has ever had to make.”

A law signed by Governor Jerry Brown that took effect this year requires municipalities to pursue mediation or declare a fiscal emergency before seeking bankruptcy protection. The law was sought by public-employee unions after Vallejo, a city of 120,000 in the San Francisco Bay Area, which went bankrupt in 2008 and asked a court to help it void labor contracts.

It was unclear whether San Bernardino would need to go through mediation.

Penman said during the meeting that former city employees had understated the extent of San Bernardino’s fiscal woes in “falsified” reports to the council and mayor over the past 16 years. He declined to name anyone. Mayor Patrick Morris, who took office in 2006, said it was the first time he’d heard such allegations.

‘New Information’

“This is a wholesale indictment of all of the officials who have served over a number of years,” Morris said in an interview after the meeting. “It’s new information to me.”

San Bernardino is the seat of San Bernardino County, which at more than 20,000 square miles is the largest county by area in the contiguous U.S.

San Bernardino County and neighboring Riverside County form a metropolitan area that had the third-highest foreclosure rate in the U.S. in May, according to RealtyTrac Inc., an Irvine, California-based data provider.

The area’s unemployment rate was 11.8 percent that month, compared with 8.2 percent nationwide, according to U.S. Labor Department data.

This does not count those who have lost their unemployment insurance and are no longer reported as unemployed. The true numbers in those counties are closer to 50-65% unemployment.

The city and its agencies have $243 million of debt outstanding, including $48.6 million of taxable pension- obligation bonds, according to financial statements. Per-person debt was $1,506, or 5.4 percent of personal income.

“Cities are running out of options,” Michael Sweet, a partner specializing in bankruptcy at the San Francisco office of law firm Fox Rothschild LLP, said yesterday in a telephone interview. “As they see pension contribution obligations and retiree health-care costs going through the roof, revenue is at best stable if not declining.”

Here's a prophecy---- you will see many more cities go under. The whole place is broken.

12-07-2012, 12:59 PM
So it won't be the earthquake that brings them down to their knees? :(

12-07-2012, 01:30 PM
Hey Joe

Its these high wages and pension that the unions demand that is causing the problem.

Many cities in the USA are close to being broke.

Someone has to produce something so that cities can pay for teachers, police and firemen etc

Then people wonder why Asia is doing so well.

12-07-2012, 01:49 PM
I agree with that ... but on 3 News at 12, Baltimore are taking legal action against Barklays Bank in regard to "fixing" of interest rates ... apparently Barklays stand to loose Billions.

12-07-2012, 02:05 PM
An E-Mail doing the rounds over here Joe. :D

To the citizens of the United States of America from Her Sovereign Majesty Queen Elizabeth II

In light of your immediate failure to financially manage yourselves and also in recent years your tendency to elect incompetent Presidents of the USA and therefore not able to govern yourselves, we hereby give notice of the revocation of your independence, effective immediately. (You should look up 'revocation' in the Oxford English Dictionary.)

Her Sovereign Majesty Queen Elizabeth II will resume monarchical duties over all states, commonwealths, and territories (except Kansas, which she does not fancy).

Your new Prime Minister, David Cameron, will appoint a Governor for America without the need for further elections.

Congress and the Senate will be disbanded. A questionnaire may be circulated sometime next year to determine whether any of you noticed.

To aid in the transition to a British Crown dependency, the following rules are introduced with immediate effect:


1. The letter 'U' will be reinstated in words such as 'colour,' 'favour,' 'labour' and 'neighbour.' Likewise, you will learn to spell 'doughnut' without skipping half the letters, and the suffix '-ize' will be replaced by the suffix '-ise.' Generally, you will be expected to raise your vocabulary to acceptable levels. (look up 'vocabulary').


2. Using the same twenty-seven words interspersed with filler noises such as ''like' and 'you know' is an unacceptable and inefficient form of communication. There is no such thing as U.S. English. We will let Microsoft know on your behalf. The Microsoft spell-checker will be adjusted to take into account the reinstated letter 'u'' and the elimination of "-ize."


3. July 4th will no longer be celebrated as a holiday.


4. You will learn to resolve personal issues without using guns, lawyers, or therapists. The fact that you need so many lawyers and therapists shows that you're not quite ready to be independent. Guns should only be used for shooting grouse. If you can't sort things out without suing someone or speaking to a therapist,then you're not ready to shoot grouse.


5. Therefore, you will no longer be allowed to own or carry anything more dangerous than a vegetable peeler. Although a permit will be required if you wish to carry a vegetable peeler in public.


6. All intersections will be replaced with roundabouts, and you will start driving on the left side with immediate effect. At the same time, you will go metric with immediate effect and without the benefit of conversion tables. Both roundabouts and metrication will help you understand the British sense of humour.


7. The former USA will adopt UK prices on petrol (which you have been calling gasoline) of roughly $10/US gallon. Get used to it.


8. You will learn to make real chips. Those things you call French fries are not real chips, and those things you insist on calling potato chips are properly called crisps. Real chips are thick cut, fried in animal fat, and dressed not with catsup but with vinegar.


9. The cold, tasteless stuff you insist on calling beer is not actually beer at all. Henceforth, only proper British Bitter will be referred to as beer, and European brews of known and accepted provenance will be referred to as Lager. New Zealand beer is also acceptable, as New Zealand is pound for pound the greatest sporting nation on earth and it can only be due to the beer. They are also part of the British Commonwealth - see what it did for them. American brands will be referred to as Near-Frozen Gnat's Urine, so that all can be sold without risk of further confusion.


10. Hollywood will be required occasionally to cast English actors as good guys. Hollywood will also be required to cast English actors to play English characters. Watching Andie Macdowell attempt English dialogue in Four Weddings and a Funeral was an experience akin to having one's ears removed with a cheese grater.


11. You will cease playing American football. There are only two kinds of proper football; one you call soccer, and rugby (dominated by the New Zealanders). Those of you brave enough will, in time, be allowed to play rugby (which has some similarities to American football, but does not involve stopping for a rest every twenty seconds or wearing full kevlar body armour like a bunch of nancies).


12. Further, you will stop playing baseball. It is not reasonable to host an event called the World Series for a game which is not played outside of America. Since only 2.1% of you are aware there is a world beyond your borders, your error is understandable. You will learn cricket, and we will let you face the Australians (World dominators) first to take the sting out of their deliveries.


13. You must tell us who killed JFK. It's been driving us mad.


14. An internal revenue agent (i.e. tax collector) from Her Majesty's Government will be with you shortly to ensure the acquisition of all monies due (backdated to 1776).


15. Daily Tea Time begins promptly at 4 p.m. with proper cups, with saucers, and never mugs, with high quality biscuits (cookies) and cakes; plus strawberries (with cream) when in season.


God Save the Queen! ;)

12-07-2012, 02:20 PM
I daresay just putting up new traffic signs in metric and on the wrong side of the road would bankrupt Britain instantly. Never mind re-striping the athletic fields to play cricket and fat-football.

If youse guys feel up to it, then by all means drop over and see if you can rectify things to a new order, since none of any worldwide form of government has worked yet - given six thousand years of attempts.

12-07-2012, 03:11 PM
New Order you say Joe....where have i heard that before?

12-07-2012, 03:18 PM
The Pomgolians will be arriving in a fleet of high speed Lucas equipped vessels. This should give you about 375 years warning that the first one is almost ready to be launched.

. . . since none of any worldwide form of government has worked yet - given six thousand years of attempts. The British have got this "not working" business honed to perfection, although they are rather envious of Swiss Post.

12-07-2012, 03:38 PM
New Order you say Joe....where have i heard that before?

Hmmmmmm - mebbe.