New SBS Report Asks 'Is Bankruptcy Right For Local Government?'

Feb 27, 2013, 09:30 ET from State Budget Solutions

ALEXANDRIA, Va., Feb. 27, 2013 /PRNewswire-USNewswire/ --Today State Budget Solutions (SBS), a non-partisan advocate for state budget reform, released  "Municipal Bankruptcy: An Overview For Local Officials," a guide to help state and local officials understand the complexity and implications of municipal bankruptcy.

Municipalities throughout America are facing "hometown" fiscal cliffs, fueled by underfunded pension commitments, expensive union contracts and unsustainable government growth. The goal of "Municipal Bankruptcy: An Overview for Local Officials" is to assist elected officials as they wrestle with proposals for massive tax increases, deleterious services cuts and state bailouts by explaining the complicated process of filing for Chapter 9 protection.

Since 2010, twenty-eight municipalities filed for municipal bankruptcy. Due to the enormous complexity of municipal bankruptcy law and the pending cases still attempting to define important factors like the scope of creditors, few resources are available to policymakers considering this option. "Municipal Bankruptcy: An Overview For Local Officials" seeks to meet that need.

"Municipal Bankruptcy: An Overview For Local Officials" includes:

  • An overview of who may file and specific eligibility requirements.
  • The role of key players in the Chapter 9 process.
  • Examples of municipalities that have filed, the various factors that impacted their decision, and the ultimate outcome.
  • An analysis of both the positive and negative policy impacts of filing to be weighed by struggling municipalities.
  • Important questions for municipal elected officials to ask in order to gain understanding of the process, and what it will mean to their citizens, taxpayers, and government and to the long-term viability of the community.

The publication is available on SBS website by clicking here

Multiple hard copies are available for publication by clicking here

About State Budget Solutions

The State Budget Solutions is non-partisan, positive, pro-reform, proactive and anchored in fundamental-systemic reforms for state budgets and public pensions. State Budget Solutions is a project of Sunshine Review, a national, nonprofit pro-transparency organization. The goal is to successfully engage political journalists/bloggers, state officials and opinion leaders in a new way of thinking about state government and budgets, fundamental reforms, transparency and accountability. Sharing studies and articles, data sets, anecdotes, and compelling narrative about what is happening in state and local budgets, The State Budget Solutions presents and disseminates information about every aspect of coming fiscal and economic disasters and, more importantly, highlights fundamental reforms to avoid them.

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