Vallejo, California Files Bankruptcy
We warned here and here about city, county and state budget deficits, now the first casualty...
Last night, Vallejo, California's city council voted to go into bankruptcy,
saying the city facing a $16 million deficit, doesn't have enough money to pay its bills.
The city of 117K is facing ballooning labor costs and declining housing-related tax revenue that have left it near insolvency.
Police and firefighting salaries, pension and overtime consume almost 80% of Vallejo's $89 million general fund budget.
Cities in California on average spend about 60% of their budgets on firefighter and police salaries.
There is no spillover... U.S. state sales-tax collections fell in the first quarter for the first time in six years.
The Govenator's office predicted the California state budget deficit may reach $20 billion,
more than twice the size of previous estimates and enough to account for nearly one-fifth of the budget.
Hattip To Bloomberg.
Last night, Vallejo, California's city council voted to go into bankruptcy,
saying the city facing a $16 million deficit, doesn't have enough money to pay its bills.
The city of 117K is facing ballooning labor costs and declining housing-related tax revenue that have left it near insolvency.
Police and firefighting salaries, pension and overtime consume almost 80% of Vallejo's $89 million general fund budget.
Cities in California on average spend about 60% of their budgets on firefighter and police salaries.
There is no spillover... U.S. state sales-tax collections fell in the first quarter for the first time in six years.
The Govenator's office predicted the California state budget deficit may reach $20 billion,
more than twice the size of previous estimates and enough to account for nearly one-fifth of the budget.
Hattip To Bloomberg.
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