News
Another California city heads for bankruptcy
San Bernardino, Calif., will become the second largest city in the nation to file for bankruptcy, according to The Associated Press (AP). The City Council for the southern California city of about 210,000 people voted July 10 to seek Chapter 9 bankruptcy protection. Stockton, Calif., the nation’s largest bankrupt city, filed June 28.
San Bernardino’s City Council directed the city attorney to immediately begin bankruptcy proceedings. It will be the third California city to go bankrupt in the last month. Mammoth Lake, a much smaller city, voted to seek bankruptcy protection July 3.
San Bernardino faces a $45.8 million budget deficit. The city has already stopped paying some vendors, and Interim City Manager Andrea Miller told the council that the city may not be able to make payroll over the next three months. “We have an immediate cash flow issue,” Miller said.
The city attorney said budget officials had presented falsified budget documents to the City Council for 13 of the last 16 years. Law enforcement officials said they have an open investigation into allegations of misconduct in city government, according to the Los Angeles Times.
Stockton, a northern California city of almost 300,000 people, surpassed Bridgeport, Conn., which filed for bankruptcy in 1991, as the largest bankrupt U.S. city. Jefferson County, Ala., which filed in November 2011, is the largest local government bankruptcy.
Where were the auditors when
Where were the auditors when this was going on. I hope tehy are in the dock when the civil suits start coming
No auditors for the last 16
No auditors for the last 16 year? Any intelligent thought put into revenue forcasting? I work for a municipality that is one of the only cities in our area in decent financial shape because of our good, thorough financial reporting and conservative revenue forcasts. I hope San Bernadino fired their budget officials.
We have this issue in WA,
We have this issue in WA, Australia. Some left wing supporters think that debt is acceptable when supporting the people.
Oops, no.
Sounds like no check and
Sounds like no check and balances, no future forecasting, too much aggressive spending, and probably run away labor unionS. The tax payers of San Bernandino should get out the pitchforks and torches!
Just waiting for this to all
Just waiting for this to all be blamed on “union thugs”, when in all reality it was administrative failure. WHere were the checks and balances? Sounds like another case of the wolf guarding the hen house!
SEEMS LIKE SOME OTHER
SEEMS LIKE SOME OTHER OFFICIALS WERE NOT DOING THEIR JOB EITHER…I WORK FOR A CITY GOVERNMENT AND WE ARE AUDITED EVERY YEAR BY CHOICE….SO MY QUESTION IS HOW DOES A CITY GO FOR THAT LONG OF A PERIOD WITHOUT AUDITS OR BALANCING THEIR BOOKS?…..SEEMS LIKE SOMEONE ELSE NEEDS TO BE FIRED FOR CONSPIRING (CITY MANAGER, MAYOR, COUNCIL MEMBERS) BECAUSE HOW COULD ALL OF THIS BE GOING ON AND NO ONE KNOWS ABOUT IT! SOUNDS LIKE AN INSIDE JOB TO ME!
Aside from the regulatory
Aside from the regulatory requirements of having yearly audits and reports, our manaagement couldn’t get away with falsifing the audit reports when presented to our Commissioners as they receive a letter and report directly from the auditor! You must have proper checks and balances!
I suspect the real issue is
I suspect the real issue is that the budget folks and public officials, year in and year out, over-estimated the revenues and under-estimated the expenditures. The auditor would only be reporting the actual results against the budget, showing large unfavorable variances. It is not the auditor’s responsbiilty for the failures of management to properly budget.