Skip to comments.City of Compton (California) may declare bankruptcy by September: officials
Posted on 07/18/2012 3:01:10 AM PDT by Zakeet
The City of Compton, a city of 93,000 people located on the outskirts of Los Angeles, must decide by September 1 whether to seek bankruptcy, according to its two most senior financial officials.
Such a move would see it join a growing number of deficit-hobbled California cities that have used the filing to restructure onerous debt loads.
Compton, which has an accumulated $43 million deficit and has depleted what had been a $22 million reserve, will run out of cash to make its payroll on September 1 at its current cash consumption rate, city comptroller Steven Ajobiewe told the city council during a July 17 meeting.
"I have $3 million in the bank and $5 million in warrants due in the next 10 to 12 days," said city treasurer Doug Sanders. "By then, the council will have a decision to make: don't pay the bonds, default on them, or have a serious talk about bankruptcy."
The city council adjourned at 11 pm without discussing a potential bankruptcy filing.
Compton Mayor Eric J. Perrodin also said he brought unspecified charges of "waste, fraud and abuse of public monies" to California officials, and had met with auditors from both the state and Los Angeles County.
He told the city council that at one point in its past the city had overspent legally set limits on certain programs by $17 million but would not elaborate.
Neither the state nor county has started an audit or investigation, city officials said.
Unlike San Bernardino, which has a large unfunded liability to pay its employees' pensions, Compton years ago increased its property tax to fund its workers' pension obligations, said Perrodin, and the retirement program is fully funded.
(Excerpt) Read more at reuters.com ...
>> We need of map of CA showing all the bankrupt towns.
Just get yourself a generic map of CA showing ALL its towns, and wait a year or two for it to become accurate. :-)
Do what’s right for the state and nation and the cities will stand or fall all by themselves.
You need enough of a tax base. Do they have that? Nothing else matters. Are there enough paying in to support the govt. that is paying out to those not paying in? Provide necessary services as well? I think there are cities out there beyond help. Compton is beyond help. They don’t have a tax base. They have recipients.
Its nice to have a whipping boy but sometimes ideology gets in the way of reality. The fact is that some of the wealthiest neighborhoods in the state are around the outskirts of Detroit. Mitt Romney raised the bulk of his Michigan money in Detroit. My sister and her husband are both 6 figure earners in Detroit. There is money and potential there.
The thing is that we need to stop worrying about fixing cities. Do the right things for the federal and state and the cities will inevitably follow. As the state economy does better, businesses are coming and Detroit is one of the places they’re settling.
Detroit is the second busiest border crossing in the country and should be doing better. Unfortunately that single crossing is under sole control of Detroit’s wealthiest slumlord and democrat donor. Unfortunately Americans for prosperity is is on the side of the democrats in that fight.
All well and good but A is supporting B. The only question is whether A is capable of supporting B as B grows.
Don’t worry about B. B will grow if the will is there. If not, it dies.
B grows period as of now. If we could stop that growth we wouldn’t be in this shape as a nation. You’re right it grows till it dies but we have a political class that is going to resort to more and more extreme measures to keep the beast alive.
More and more evidence keeps piling up that the liberal governance model does not work and results in bankruptcy. Or, like Detroit, the cities simply are abandoned and revert to nature — literally. We see it in American cities. We see it in extremely liberal American states like California. We see the ultimate end result in statist societies like North Korea and pre-liberation Albania, where people used horses and carts. Compton is another example. The sad thing is that all these bankruptcies and crises don’t change the people’s view that statism doesn’t work.
What I’m saying is that doing the right thing for the state and federal should be enough to pull the city along. However that includes saying “No” to the city looking for handouts as we encourage them to behave responsibly.
What... they haven’t taxed the rich people in Compton enough?
We’re talking about California’s own little Detroit here...
Nice place, that Compton... Can't imagine why it'd be having problems..
If you have thousand of illegals in your town and do not pay taxes to the city and part of those taxes are for schools,hospitals,property,medicare etc. Then in the end of the day your legal people in the city will have to pay. I think I would be upset if I were a legal citizen of the city. I can see pension money being used to help the citizen out. Then the people have worked all their lives will have very little when retiring from your city. Please wake-up CA before it is to late.
Compton is majority Hispanic (65%). Blacks make up 33% of the population.
Not sure pulling along is any sort of a decent option. Some places like Compton might never be anywhere near self supportive.
That’s kind of my point. Survival of the fittest.
Cut off the money and if the city has a reason and will to survive it will begin to produce. Call it tough love.
The NEW ballad of Jed Clampett
Come and listen to a story ‘bout a man named Jed
Poor oil entrepreneur barely kept his family fed
Then one day he was working for some food,
And up through the town come a bumbling clown
(Brown that is, take a toke, what a joke)
Well the first thing you know old Jed’s taxes are to much to bear,
Kin folk said Jed move away from there!
Said California is no place for you to be
So they loaded up the truck and they moved from Beverly
(gon back to the Hills they are, fishn holes, country and western stars)
Well now it’s time to say goodbye to Jed and all his kin
They would like to thank you folks for kindly dropping in
You’re all invited back again to their new locality
To have a heaping helping of their hospitality
(Redneck Hillbillies, is what the press call ‘em now,
Clingers of bibles and guns and to Obama no bow!
Nice folks Y’all come back now, ya hear?)
You know many people on here assume people don’t work because they don’t want to. They rarely make the distinction between those that simply can’t find work and those that won’t. That point being made,and i have no idea where u stand on that,what happens to all the people without jobs? From either side of the question? where do they go?
Doing what’s good for America, generally means jobs will be created as a result. I’m not one of those who assumes that people are on welfare, food stamps and unemployment are just plain lazy (I’m a Michigander after all).
Its why I go against the conservative grain in select situations like spending taxpayer money to build a second bridge across the Detroit river. It isn’t specifically for Detroit but Detroit will benefit greatly as a result. Its the second busiest freight crossing in America and easing the bottleneck and dividing traffic between two crossings will bring warehouses more traffic, truck plazas, duty free shops etc. They’ll be jobs in one of the most economically depressed areas of the city. A lot of the residents of Del Ray see it as their ticket out of that neighborhood and into potential jobs.
Basically I see it as good for America and for the state with Detroit reaping the benefits as a result rather than as a primary goal.
In the case of Compton, what is truly needed is obviously different but I’m sure that there’s something of value there that could be exploited with the city reaping the benefits. Cities grow where they are for a reason. We need to look at what spurred growth in the cities and concentrate on that and not giving handouts. Give them a hand up instead.