In a recent column, Sacramento Bee Columnist Dan Walters pointed out that Stockton is not the only government to put itself into a precarious financial situation. Other cities and even the state are facing dire times.
Similarities exist between the faltering city of Stockton and the state, where both glutted themselves during boom years, and suffered consequences during the bust years. In particular, generous benefits were extended at all levels of government. But once the economy turned sour, governments were left holding the bag with few options.
Stockton and Mammoth Lakes are both using new laws in California to renegotiate debts and restructure finances, however that option doesn’t exist for the State.
Los Angeles isn’t knocking on the door of AB 506 yet, however, they are beginning to discuss their finances, a conversation that’s including the “B-word.”
From the Sacramento Bee:
It’s easy – justifiably so – to beat up on Stockton for spending itself into a fiscal hole so deep that bankruptcy may be its only course.
City officials borrowed and spent heavily on a baseball park, a sports arena, a marina and other facilities in hopes of resurrecting a woebegone downtown, and simultaneously boosted their employees’ salaries and fringe benefits.
Read the full article here.