DOOLEY Observed: San Bernardino becomes third California city seeking bankruptcy

Thomas Jefferson said in 1802: "I believe that banking institutions are more dangerous to our liberties than standing armies."

"The democracy will cease to exist when you take away from those who are willing to work and give to those who would not."-- Thomas Jefferson

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Television is one daylong commercial interrupted periodically by inept attempts to fill the airspace in between them.

If you can't start a fire, perhaps your wood is wet ....

When you elect clowns, expect a circus ..............

Wednesday, July 11, 2012

San Bernardino becomes third California city seeking bankruptcy

By Jim Christie

(Reuters) - The city council of San Bernardino, California, voted on Tuesday to file for bankruptcy, marking the third time in recent weeks a city in the most populous U.S. state has opted to seek protection from its creditors.

The decision by the leaders of San Bernardino, a city of about 210,000 residents approximately 65 miles (104 km) east of Los Angeles, followed a report by city staff that said the city faced an imminent financial crisis.

The report said the city had exhausted its reserves and projected spending would exceed revenue by $45 million in the current fiscal year which started on July 1.

Chapter 9 bankruptcy would give San Bernardino an opportunity to restructure its battered finances, city staff said during a webcast of the city council meeting.

But the council's vote may backfire on San Bernardino in the municipal debt market, and raises concerns about local officials in California potentially looking to bankruptcy protection as an easier solution than making tough decisions about spending cuts and raising revenue, said Dick Larkin, director of credit analysis at muni bond broker-dealer HJ Sims.