America's Cities Are in Financial Peril
Detroit becomes largest U.S. city to file for bankruptcy.
1 / 7
Buried in Debt - As the economy continues to emerge from recession, cities throughout the U.S. are faltering. On Thursday, Detroit joined the list of growing cities to file for bankruptcy protection, becoming the largest city in U.S. History to do so. BET.com takes a cities that found themselves in financial peril in recent years. —Britt Middleton
Photo By Photo: GettyImages
2 / 7
Detroit, Michigan - Following months of setting the groundwork for legal action, the city of Detroit filed for Chapter 9 bankruptcy protection in federal court on July 18. "The filing begins a 30- to 90-day period that will determine whether the city is eligible for Chapter 9 protection and define how many claimants might compete for the limited settlement resources that Detroit has to offer," writes USA Today. The petition will seek protection from the city's creditors and unions that are renegotiating $18.5 billion in debt among other liabilities. (Photo: Spencer Platt/Getty Images)
Photo By Spencer Platt/Getty Images
3 / 7
Scranton, Pennsylvania - Grappling with $3.4 million in vendor bills and a $16.8 million budget deficit the city couldn't afford to pay, the mayor of Scranton, Pennsylvania, was forced to cut the salaries of all 400 city workers — including firefighters, police officers and the mayor himself — to the minimum wage of $7.25 an hour as a means to keep the near-bankrupt city afloat. A court had previously forbid Mayor Chris Doherty, above, to cut city worker salaries, and in response labor unions representing those workers are suing both Doherty and the city.(Photo: Steve Leonard/Courtesy of Wikicommons)
4 / 7
Stockton, California - When Stockton filed for bankruptcy on June 28 it became the first city in California to file for protection since 2008. The housing market crash that swept the state in recent years was a huge part of the city's financial problems, and over the past three months Stockton officials have tried to mediate with its creditors to close its $26 million budget shortfall. The city, with a population of 290,000, tried previously to slash debts by cuttings wages and benefits in addition to cutting its police force, firefighter force and 40 percent of all other city employees. (Photo: Courtesy of Wikicommons)
5 / 7
Mammoth Lakes, California - After a property developer won a $43 million lawsuit against the town of Mammoth Lakes, California, the ski resort town of just over 8,000 residents became the second California city to file for bankruptcy on July 2. (Photo: Courtesy of Wikicommons)
ADVERTISEMENT
6 / 7
San Bernardino, California - On July 10, the San Bernardino City Council voted to file for Chapter 9 bankruptcy protection after a financial report submitted by the city's interim city manager revealed a $45 million shortfall. In addition to declining property values — which translated into lower property tax revenue for the city — San Bernardino, which has about 211,000 residents, has lost anywhere from $10 million to $16 million in revenue from taxable sales over the past several years. (Photo: Courtesy of Wikicommons)