Another city is going bankrupt now too, San Fernandino........this city has a population of 211,000 and is in California. California has 3 cities that will now be bankrupt soon. Pensions are one of the leading costs of bankruptcy, which is troubling for those who believe govt jobs are an easy way to retire in safety. No longer homies.....
http://latimesblogs.latimes.com/lan...cy-could-other-california-cities-be-next.html
Last month, Stockton became the largest city in the state to seek bankruptcy protection after it was unable to come to agreement with its employee unions and creditors on a plan to close a $26-million gap in its general fund.
On July 2, the tiny resort town of Mammoth Lakes filed bankruptcy papers in part because it was saddled with a $43-million court judgment it couldn't pay.
San Bernardino couldn't close a $45.8-million budget shortfall and would be unable make its payroll this summer, city leaders said. Days before Tuesday's City Council vote, the city of 211,00 people had just $150,000 in the bank. The city barely scraped together enough money to cover its June payroll.
DOCUMENT: San Bernardino bankruptcy report
Rising public pension costs are one of the catalysts pushing cities into fiscal peril. In San Bernardino, the city's obligation to its employee retirement system rose from $1 million in the 2006-07 fiscal year to nearly double that in the current budget year. In three years, those costs are expected to swallow 15% of the budget.
Pension spending grew an average of 11.4% a year in the state's biggest cities and counties from 1999 to 2010, roughly twice as fast as spending on public safety, social services, recreation, health and sanitation, according to a February report by the Stanford Institute for Economic Policy Research.
Joe Nation, a Stanford economics professor and co-author of the February report, thinks for at least some cities, insolvency is inevitable unless they can wrest much bigger concessions on salaries and pensions from public employees.
"I think this is the tip of the iceberg in terms of the problem,'' Nation said. "Stockton was spending $12 [million] or $13 million on pensions 10 years ago. By 2010, it was $30 million … and will double again over the next five years, unless something is changed."
