Providence has become the latest city to get press for flirting with the brink of insolvency and, thus, is starting to generate increasing debate over whether it will file for Chapter 9, municipal bankruptcy, protection. To wit, it's mayor, Angel Taveres, noted the city could essential go broke by June without concessions from retired employees as well as, to a lesser extent some nonprofit entities.
The statement could be a strategy to bust some collective bargaining agreements after the smaller Central Falls, RI municipal bankrutpcy that caused retirees to eventually agree to an out-of-court settlement to save millions on entitlements.
Meanwhile, the bombshell of the week in bankruptcy came out of Harrisburg. State-appointed receiver David Unkovic said publicly that despite the state and the mayor’s vitriolic fight to prevent the council’s Chapter 9 filing last fall, bankruptcy may in the end be the only choice for the city by July if stakeholders don’t make concessions and warring city government factions don’t agree to work together.
Unkovic recently unveiled a plan to keep the city out of bankruptcy that included selling the incinerator operation that has caused a lion's share of its debt as well as seets such as parking structures.
(Note: More on Chapter 9/municipal bankruptcy in the lead story of this week's NACM eNews, available later today at www.nacm.org).
Brian Shappell, NACM staff writer