Number of California Cities Going Bankrupt Mounts |

List Of California Cities That Have Declared Bankruptcy and Journalism Continues To Fail These Residents

Date: 07/17/12

Updated 11-29-12 San Bernardino City Attorney Story

Generous, poorly negotiated labor contracts by politicians who are supported by labor unions are leading to the bankruptcy of many cities.  For years, politicians have vilified business such as the developers and have claimed that the businesses have too much influence in politics.  However, the bankruptcies illustrate that labor union and contracts that are payments for campaign contributions are destroying the economies of the cities and soon will destroy the state. The latest city to declare bankruptcy, San Bernardino,  has revenue of $120 million annually and labor costs of $126 million, according to news reports.  The cities and other governments are negotiating labor contracts that do not allow them to adjust pay, staffing or job duties in the event of revenue collapses or inflation on the services they provide to retirees.

In addition, journalism failed these communities and continues to do so.  The Junk Journalists who cover these issues do not provide full disclosure of the facts to their readers.  For example, former Stockton City Manager Dwayne Milnes is leading a group of retired city workers in a lawsuit against the city that seeks to force it to continue to pay 100 percent of the retired employees medical coverage.  This demand is being made in a lawless city where crime is unchecked.

Milnes negotiated those terms in the 1990s and while that is disclosed, reporters do not question him on why he left the city so exposed to his errors.  Milnes defends his error by saying it was a simple miscalculation of revenue and medical costs and at the time he gave that generous concession, he got an agreement from the unions not to seek pay increases.  In reading the stories, Milness was not asked how it made sense to obligate the city to a 50-year-plus obligation for a one year concession on salaries.  Milnes poor negotiation skills, provided a reader believes his excuse, exposed the city to inflation risk for many years.  In addition, it appears the salary concession was short lived.

The Junk journalist do not disclose average retirement pay or whether Milnes is just representing these employees or is part of the group.  The reporters should also give readers the retirement package Milnes receives.   The readers are unable to determine whether these workers should be able to cover their medical costs.  For example, Stockton currently, according to one database, has 82 retired workers making more than $100,000 a year.

The following cities have declared bankruptcy

Vallejo, California –  Bankruptcy – May  2008

Vallejo’s Hundred Thousand Dollar Retired Workers Club

NPR – What Happens When A City Declares Bankruptcy – July 11, 2012

Fox News – Vallejo, Calif. claws back from bankruptcy – May 25, 2012

Washington Post – Vallejo, Calif., once bankrupt, is now a model for cities in an age of austerity – May 23, 2012

Wall Street Journal – In Vallejo, Bankruptcy Scars Still Visible – January 19,2012

San Francisco Gate – Vallejo votes to declare Chapter 9 bankruptcy – May 07, 2009

Stockton, California, Bankruptcy – June 2012

Stockton Record Nearly A Quarter Of City Workers Still Make More Than $100,000 – Feb. 25-2013

Stockton’s Hundred Thousand Dollar Retired Workers Club

Los Angeles Times –  Stockton Bankruptcy retires sue to stop cuts to health benefits – July 12, 2012

Wall Street Journal – Stockton makes Top 10 Most Dangerous Cities In America list June 19, 2012

Stockton Record – Day one in court for Stockton’s Bankruptcy case – July 7, 2012

Stockton Record – Letters to the Editor On Bankruptcy – July 6, 2012

Reuters – How Stockton Went Broke, A 15-year spending binge – July 3, 2012

Stockton Record – City wins ruling on vacation, sick time payments to police – April 12, 2012

Stockton Record – Irrational demands not helping a Junk Journalism column by Michael Fitzgerald criticizing people who read his paper – May 09, 2012

Stockton Record – Stockton police chief ready to retire – January 11, 2006  In this example of Junk Journalism, the reporter, David Siders,  fails to mention the 56-year-old chief will earn more in retirement than he did working.  A fire chief who retired around the same time is also earning more than $150,000 a year in retirement.

Stockton Record – Without Police, Fire Cooperation city cannot fix this disaster – October 1, 2008

Mammoth Lakes, California – Bankruptcy  – June 2012

Mammoth Lakes Fire District Hundred Thousand Dollar Retired Workers Club

San Bernardino, California – Bankruptcy  – July 2012

San Bernardino Hundred Thousand Dollar Retired Workers Club

Los Angeles Times – San Bernardino Bankruptcy: Criminal probe underway – July 13, 2012

CBS Los Angeles – City Attorney Tells Residents To Lock Doors and Load Guns


Headed For Bankruptcy:


City Compton of Hundred Thousand Dollar Retired Workers Club

Reuters – City of Compton may declare bankruptcy by September – July 18, 2012


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