https://www.americancityandcounty.com/wp-content/themes/acc_child/assets/images/logo/footer-logo.png
  • Home
  • Co-op Solutions
  • Hybrid Work
  • Commentaries
  • News
  • In-Depth
  • Multimedia
    • Back
    • Podcast
    • Latest videos
    • Product Guides
  • Resources & Events
    • Back
    • Resources
    • Webinars
    • White Papers
    • IWCE 2022
    • How to Contribute
    • Municipal Cost Index – Archive
    • Equipment Watch Page
    • American City & County Awards
  • About Us
    • Back
    • About Us
    • Contact Us
    • Advertise
    • Cookie Policy
    • Privacy Statement
    • Terms of Service
American City and County
  • NEWSLETTER
  • Home
  • Co-op Solutions
  • Hybrid Work
  • Commentaries
  • News
  • In-Depth
  • Multimedia
    • Back
    • Podcasts
    • Latest videos
    • Product Guides
  • Resources/Events
    • Back
    • Webinars
    • White Papers/eBooks
    • IWCE Expo
    • Calendar of Events
    • How to Contribute
    • American City & County Awards
    • Municipal Cost Index
    • Equipment Watch Page
  • About Us
    • Back
    • About Us
    • Contact Us
    • Advertise
    • Cookie Policy
    • Privacy Stament
    • Terms of Service
  • newsletter
  • Administration
  • Economy & Finance
  • Procurement
  • Public Safety
  • Public Works & Utilities
  • Smart Cities & Technology
  • Magazine
acc.com

issue_20070101


California city dodges bankruptcy bullet—for now

California city dodges bankruptcy bullet—for now

The Vallejo City Council approved three resolutions that should enable the city to avoid filing for bankruptcy by the end of the month. Council approved,
  • Written by Michael Keating
  • 6th March 2008

The Vallejo City Council approved three resolutions that should enable the city to avoid filing for bankruptcy by the end of the month. Council approved, by a 5-2 margin, a tentative agreement with its police and firefighters’ unions that includes concessions by the unions. At press time, the union members were scheduled to vote on the tentative agreement by March 7. The agreement applies to the labor contract that expires June 30.

The City Council also approved a fiscal emergency plan that will amend the city’s 2007-2008 budget. The blueprint calls for eliminating 38 positions, including 16 furloughs. The final vote on the emergency plan was scheduled for this week.

Vallejo had been facing a $6 million deficit in the current budget and a $14 million deficit in next year’s budget. Without council’s action, officials said the city treasury would be empty by the end of this month.

City manager: Plan has a 5 percent chance of success

The City Council gave its blessing to the emergency plan even though City Manager Joseph Tanner said he believed the plan has just a 5 percent chance of success. According to news reports, Tanner said that the plan was not a final solution, but that it will give the city four months to get its fiscal health in order.

The city faces a $13.2 million 2007-2008 general fund operating deficit and a negative funding balance of $9 million on June 30. The fiscal emergency plan and the concessions by the police and fire unions are expected to save $9 million.

Tanner also said that the city needs more revenue, and that voters may be asked to approve tax hikes in the November election.

Under the tentative agreement, firefighters and police will get a 2 percent raise between today and June 30. Changes in retirement payouts and minimum staffing levels also are part of the tentative pact. Half of the payouts for 20 police and firefighters who retired in February will be deferred until December, providing the city does not file for bankruptcy

The public safety contracts, which expire in 2010, will be extended one year if the unions and the city can iron out a new agreement that addresses the city’s fiscal health by April 22. If there is no new agreement, the one-year contract extension will be canceled.

If long-term contracts are not reached with Vallejo’s public safety unions by April 22, the City Council may have to consider a bankruptcy resolution in late April or early May.

Vallejo, which is about 23 miles from San Francisco, has a population of 116,844, according to the 2006 U.S. Census Bureau estimate.

What about other Golden State communities?

Kim Reuben, who is a senior research associate at the Urban Institute, told GovPro.com that more cities like Vallejo, “which has had large declines in home sales and prices, and increases in the number of foreclosures,” could face similar financial difficulties.

“There are a number of smaller cities in California that had seen large expansions in the housing stock that are experiencing fiscal distress,” Reuben said. “Besides Vallejo, these include Merced and Modesto.”

Another group, the California State Association of Counties in Sacramento, Calif., is monitoring local government budgets. Jean Hurst, who is the legislative representative for revenue and taxation for the counties group, told GovPro.com that “it is unlikely that any California county will face bankruptcy in 2008.”

“It’s not clear to me,” Hurst added, “that even Vallejo will file for bankruptcy protection. Of course, this could all change once the state adopts its budget this summer.”

In mid-February, California Gov. Arnold Schwarzenegger signed a six-bill budget package designed to trim expenses in the state’s current fiscal year (fiscal 2007-2008). The package contains a variety of program cuts, payment deferrals and other strategies designed to reduce state cash outlays in the current fiscal year, and some budget savings in fiscal 2008-2009.

The package included fund shifts and budget cuts in education and state health programs. Additionally, a bill in the package delays the effective dates of cost of living increases for several social service programs.

Tags: ar issue_20070101 mag

Most Recent


  • What’s my truck worth?
    Truck Value VIN Decoding & Make/Year/Model Lookup
  • California city dodges bankruptcy bullet—for now
    Calendar of events
    A list of NIGP courses, conferences and webinars for NIGP members held in December 2012 and January 2013.
  • California city dodges bankruptcy bullet—for now
    NIGP's 67th Annual Forum and Products Exposition
    Awards presented at NIGP Forum recognized procurement professionals "reaching new heights."
  • California city dodges bankruptcy bullet—for now
    UPPCC new certifications
    The Universal Public Purchasing Certification Council announces that 208 individuals successfully completed the spring 2012 UPPCC certification examinations administered in May 2012.

Leave a comment Cancel reply

-or-

Log in with your American City and County account

Alternatively, post a comment by completing the form below:

Your email address will not be published. Required fields are marked *

Related Content

  • California city dodges bankruptcy bullet—for now
    Number of contracting professionals on the rise
  • California city dodges bankruptcy bullet—for now
    FBI employee sentenced to probation for accepting cruise
  • California city dodges bankruptcy bullet—for now
    GSA names Brasseux deputy administrator
  • California city dodges bankruptcy bullet—for now
    Auction delivers two-year power pact to Texas community

White papers


5 reasons why Plan Examiners need Objective Trapeze

30th May 2023

7 Permitting & Licensing Fails Slowing Community Growth

24th May 2023

The Secret Ingredient to Local Government Employee Retention

23rd May 2023
view all

Webinars


How to Centralize and Build a Grants Management Process at your Organization

24th May 2023

Making Permitting Easier: What We’ve Learned Helping America’s Largest Cities Improve Their Permitting Process

16th May 2023

Digital Property Tax Collection: Tales from the Trenches of Modernization

16th May 2023
view all

PODCAST


Young Leaders Episode 4 – Cyril Jefferson – City Councilman, High Point, North Carolina

13th October 2020

Young Leaders Episode 3 – Shannon Hardin – City Council President, Columbus, Ohio

27th July 2020

Young Leaders Episode 2 – Christian Williams – Development Services Planner, Goodyear, Ariz.

1st July 2020
view all

GALLERIES


10 best suburbs for city-like living

1st June 2023

Gallery: Annual index ranks America’s top performing cities; most are in the West

30th May 2023

Gallery: Top 10 American cities for seasonal and summer jobs

25th May 2023
view all

Twitter


AmerCityCounty

How decentralized identity technology can make access to government services more equitable dlvr.it/SqRHBF

9th June 2023
AmerCityCounty

Survey from U.S. Conference of Mayors details mental health crisis faced by cities dlvr.it/SqQffD

9th June 2023
AmerCityCounty

Federal government launches $11B in green energy grants for rural utilities dlvr.it/SqNFBH

8th June 2023
AmerCityCounty

State and Local Cybersecurity Grant Program: Where local governments must allocate funds to support the future of c… twitter.com/i/web/status/1…

8th June 2023
AmerCityCounty

Boston’s commuter rail system is outdated and needs an overhaul, according to advocacy report dlvr.it/SqKHmC

7th June 2023
AmerCityCounty

San Antonio-based study highlights effectiveness of urban farms dlvr.it/SqGDbh

6th June 2023
AmerCityCounty

Keeping reusable stuff out of landfills: Organization redistributes office furniture and more to nonprofits, other… twitter.com/i/web/status/1…

6th June 2023
AmerCityCounty

Report: Police response to homelessness is inherently punitive dlvr.it/SqCFwh

5th June 2023

Newsletters

Sign up for American City & County’s newsletters to receive regular news and information updates about local governments.

Resale Insights Dashboard

The Resale Insights Dashboard provides model-level data for the entire used equipment market to help you save time and money.

Municipal Cost Index

Updated monthly since 1978, our exclusive Municipal Cost Index shows the effects of inflation on the cost of providing municipal services

Media Kit and Advertising

Want to reach our digital audience? Learn more here.

DISCOVER MORE FROM INFORMA TECH

  • IWCE’s Urgent Communications
  • IWCE Expo

WORKING WITH US

  • About Us
  • Contact Us

FOLLOW American City and County ON SOCIAL

  • Privacy
  • CCPA: “Do Not Sell My Data”
  • Cookie Policy
  • Terms
Copyright © 2023 Informa PLC. Informa PLC is registered in England and Wales with company number 8860726 whose registered and Head office is 5 Howick Place, London, SW1P 1WG.