Three parking garages have already been repossessed, but that doesn’t mean that the city of Stockton is off the hook. Wells Fargo is still expecting to be paid for bonds it issued on behalf of the city.
The city received a letter from the bank last week that demanded further payment of the bond debt. The city has missed one payment of $722,000 and another payment is due in August for $1.2 million. The city has 45 days to decide how to handle the matter. Should they continue to not pay, the bank has the right to sue.
Currently, the bond payments are not factored into the emergency-spending plan that the city instituted to help stave off insolvency. However, the bank’s letter expressed an expectation that the funding be restored and included in all budgets until the debt is retired.
The creditor has also repossessed a downtown building that was intended to be the new city hall. However, it was never occupied and the city suspended payments there as well.
From the Record Net:
Wells Fargo Bank, even after it repossessed three of Stockton’s downtown parking garages, still wants to be paid for lending the money to the city to build them.
The bank hand-delivered a letter to City Hall demanding payment of the overdue bill, plus interest.
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