Daily News: July 13, 2012

Bloomberg: Not All Muni Bankruptcies Are the Same

Bloomberg noted in a recent article that three different municipalities — all in California — have filed for bankruptcy in less than a month.

Bloomberg said the three towns — Stockton, Mammoth Lakes and San Bernardino — each filed for bankruptcy for different reasons.

The basis for the filings, Bloomberg said, included: a reckless spending spree, reneging on an agreement and malfeasance in office.

Bloomberg concluded the article by saying when the economy is booming and tax revenue flows, cities have some cover for lapses in management, be it a building binge in Stockton, poor planning in Mammoth Lakes, or potential budget abuse in San Bernardino. But when a crisis strips away any excess, the problems are left bare.

To read the full Bloomberg story, click here.