The City Council in San Bernardino voted Tuesday night to seek Chapter 9 bankruptcy protection, making it the third California city in less than two weeks to make the desperate move.
The City Council directed the city attorney to make the move during a meeting where administrators explained the dire fiscal circumstances and urged them to choose the bankruptcy option.
"We have an immediate cash flow issue," Interim City Manager Andrea Miller told Mayor Patrick Morris and the seven-member City Council, according to the Los Angeles Times.
Miller said the city is facing a budget shortfall of $45.8-million. It has already stopped paying some vendors, and may not be able to make payroll over the next three months.
Four council members voted for the authorization, two opposed it, and one abstained.
City Atty. James Penman said city budget officials had falsified documents presented to the mayor and council for 13 of the last 16 years, masking the city's deficit spending.
Will they be prosecuted? Don't be on it.
The expected bankruptcy for the city of 209,000 residents is certain to heighten concerns about the fiscal forecast for other struggling California cities, which have been slashing jobs and services as tax revenues have declined during the prolonged economic slump.
The city joins two others in California - Stockton and Mammoth Lakes - that have turned to bankruptcy in recent weeks to cope
The reality of this all is large cities and municipalities can no longer afford the expenses that come with running a city. The U.S. is in a state of contraction. The global recession is here, and no president can change what is happening in the " bigger picture."
Keep an eye on Ebay in 2013, chances are good you will find your own home town listed there.
Just be patient, and don't bid until the last minute, it's the best way to up your odds.
I just bought a town last week, and am designating it as a politician-free zone.