Some cities in California go bankrupt while others prosper. Stockton, San Bernardino, Mammoth Lakes, and Valleho have all gone bankrupt in recent weeks, West Sacramento, according to its mayor, Christopher Cabaldon is surviving. Cabaldon tweeted: “4th CA city just voted to declare bankruptcy tonight, if you’re in West Sacramento worry not…our city is in solid fiscal shape.”
Cabaldon says the West Sacramento government has been cut 25 percent
over the past 4 years, boasting, “We have, in West Sacramento, been
making reductions, putting our fiscal house in order so we can make sure
that our citizens will be protected.”
Rancho Cordova, 14 miles from West Sacramento, is not only surviving, but doing very well indeed; it has enjoyed eight straight years of surplus. Rancho Cordova City Manager Ted Gaebel said:
“We don’t just pass a budget and hope things turn out ok in the hand, we manage a budget on a day to day basis. If that means cutting several million dollars during the year is what I need to do.”
Bankruptcy experts have said that cities are being bankrupted by weak property- and sales-tax revenues as their pension obligations keep growing. Stockton couldn’t agree with its employee unions and creditors on a plan to close a $26 million gap in its general fund. San Bernardino’s obligation to its employee retirement system doubled from 2007 to 2012. Pension spending grew an average of 11.4 percent a year in California’s biggest cities between 1999 and 2010, almost twice as fast as spending on public safety, social services, recreation, health and sanitation.