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CA: Vallejo bankruptcy could be model for others
Source: San Francisco Chronicle
Posted on 05.11.08 by Steve Trinward

“By declaring bankruptcy, Vallejo has thrust itself into the national spotlight as a test case for thousands of floundering cities desperate to unload their extravagant public employee contracts. ‘There’s a wave of this coming across the U.S.,’ said Sajan George, an adviser to struggling public entities who worked on restructuring Orange County after it declared bankruptcy in 1994. ‘What happens in Vallejo could definitely set a precedent.’ Battered by the plummeting housing market and skyrocketing public employee contracts, Vallejo made dubious history Tuesday night by becoming the largest California city to declare bankruptcy. The North Bay city of 117,000 was on track to start the fiscal year July 1 with a $16 million deficit and no money in reserve.” (05/11/08)


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