California Bankruptcies May Increase Without Structural Changes

Chris McKenzie, Executive Director of the California League of Cities, discusses the specter of bankruptcy and the structural difficulties cities face in addressing their fiscal deficits. The San Bernardino bankruptcy does not mean the worst is over.

As the City of San Bernardino joins the ranks of Stockton and Mammoth Lakes as yet another California city seeking bankruptcy this year, are we witnessing a budding trend? Unable to meet its $45 million budget shortfall and nearly out of cash, leaders of the City of San Bernardino in July chose to seek bankruptcy. A complicated host of reasons lie behind what drove San Bernardino to that point, from the mortgage crisis to rising pension costs, and it's evident that these recently bankrupt cities are not unique.

The Planning Report interviewed Chris McKenzie, Executive Director of the California League of Cities, to discuss the long run fiscal challenges tied to mandatory spending that so many cities are grappling with across the country. McKenzie implies that without drastic changes, cities are so strapped that conditions may only continue to get worse for those teetering on the edge. As the state government in Sacramento seeks to contain its own deficits by tapping into revenue streams once held by local government, the California League of Cities argues that the state is handicapping important tools for sparking economic growth and stability.

Full Story: League of Cities Executive Director Implies Recent String of Bankruptcies Is Not Rock Bottom

Comments

Prepare for the AICP Exam

Join the thousands of students who have utilized the Planetizen AICP* Exam Preparation Class to prepare for the American Planning Association's AICP* exam.
Starting at $199
Planetizen Courses image ad

Planetizen Courses

Advance your career with subscription-based online courses tailored to the urban planning professional.
Starting at $14.95 a month
Red necktie with map of Boston

Tie one on to celebrate your city

Choose from over 20 styles of neckties imprinted with detailed city or transit maps.
$44.95
Book cover of the Guide to Graduate Planning Programs 2012

Thinking about Grad School?

You need the essential resource for prospective planning students
Starting at $24.95