In 2008 the City of Vallejo in northern California declared bankrupcty, but did this decision benefit the city and the residents it serves?
A Los Angeles Times article on August 11, 2012 states, “Nine months after this former Navy town emerged from bankruptcy protection, its Police Department is about a third smaller than at its peak. The Fire Department has been slashed by nearly a quarter, and the median home price has dropped almost 70%. Half of the downtown storefronts are vacant.”
The article also reports, Vallejo’s “City Council recently passed its first post-Chapter 9 budget, a plan that socks away as much in rainy day reserves in one year — 5% of the general fund — as it had aspired to do over the next five. On the minus side, no sooner had the money been saved than the city had to tap it to cover an unexpected $4.5-million deficit.”
You can read the complete LA Times article here.