What big concern do cities and municipalities all over California and the rest of the country share? The bankruptcy process. Since Stockton, CA went under last month, the number of cases that seem to be popping up all over the nation only grows. However, for many cities, Stockton was a big wake-up call, encouraging them to check their books and work harder on balancing budgets.
Not Yet Filing for Bankruptcy
One city that’s concerned about filing for bankruptcy in the future is San Bernardino, CA. The southern California city has a population around 210,000 and is running up against a wall with its current spending practices.
To date, they are projecting expenditures in the new fiscal year (which began July 1) to be $45 million more than revenues. The city is already talking about several preventative measures to reduce the chances of filing for bankruptcy. However, with spending increasing, not all city council members are convinced that every elected official is realistic about the situation.
While San Bernardino certainly hopes to avoid the bankruptcy process, it could be what the city needs to get back on its feet again. Clearing the books and starting over is sometimes the only way for a city to pick itself up and carry on. However, it’s certainly not popular with residents who would see a drop in services. And city employees aren’t fans, either. For city employees, filing for bankruptcy means no pension or retirement benefits.
Filing for bankruptcy would give the city hope again in the long run. As for now, residents and analysts wait to see what course of action will be determined by San Bernardino’s elected officials this month.