With a population of 420,000, an Oakland bankruptcy would be noteworthy.
From the San Francisco Chronicle:
Even though city officials would prefer to avoid a public conversation, behind closed doors the Oakland City Council has discussed filing for bankruptcy protection in the midst of a $100 million budget deficit."We have asked the (bankruptcy) question because we wanted to know the impact," said District 5 council member Ignacio De La Fuente. "In closed session, the question has been asked, and an answer was given." He would not elaborate.
"It's a possibility," he acknowledged. "Things are that bad."
Council President Jane Brunner was equally aloof. She ably acknowledged the city's dire financial problem while managing to avoid the b-word altogether.
"We're going to try to avoid it, but am I going to say it would never happen? I can't say that," Brunner said.
Consider the city's cash position: Out of next year's general fund of approximately $415 million, police costs are estimated at $212 million, fire protection service $103 million and $41 million in debt service payments. That leaves about $60 million to pay for everything else, from library services to recreation centers to public works.
And that calculation doesn't include $50 million more in deferred debt service in a budget proposal presented to the council last month by Mayor Ron Dellums.
"We are in the worst recession since 1981," said UC Berkeley Professor John Ellwood, an economist who worked in the Congressional Budget Office. "This recession is a bit different in that it's being driven by the housing bubble, but as more and more people ask for property-tax reassessments, it's going to leave a huge funding gap for cities," Ellwood said....MORE
Should the city go bust, that professor might be able to watch his new neighbors heading north on San Pablo avenue.