The City of Mammoth Lakes, an unincorporated community in Mono County is unable to settle a $43 million judgement.
(Photo credit: USGS)
Has California lost its golden shimmer? Some days, it seems like it. Especially on a day when another California city has filed for Chapter 9 bankruptcy. This time the folks in Mammoth Lakes have thrown their hands up in the air as to say, we can’t do this anymore.
During a special meeting on Monday, July 2, the town council voted unanimously to go ahead with the filing for relief under Chapter 9.
In a statement, elected leaders said, “bankruptcy, unfortunately, is the only option that the Town is left with.”
Why is it the only option? Two reasons. One—the city doesn’t have enough money coming in to pay for its current and anticipated obligations with a $2.7 million shortfall in its 2011-2012 budget and a projected $2.8 million shortfall for 2012-2013 fiscal year.
The second, and much bigger, problem? Mammoth Lakes Land Acquisition, the town’s biggest creditor, “repeatedly refused to mediate its $43 million judgment against the Town, and obtained a State court order requiring payment of the full judgment by June 30, 2012.”
The town council already cut services and asked employees to accept significant pay cuts. It also worked out deals with other creditors.
While all of this is going down, town leaders want to reassure “it will remain open for business,” with a little help from other governmental agencies to “provide high levels of response and care.”
If your mind is still dizzy from all of this, Mammoth Lakes has put together a faq sheet.
The fact of the matter is, filing for bankruptcy has become an ugly trend in our state. It’s time to get involved. Figure out what’s going on with your local government. Make sure you know exactly where the money is going and if it’s being spent wisely. Keep an eye on the city’s happenings. It’s the only way to get government closer to you.
For now, we sit and wait. Is anyone else going to play follow the leader? Which city will be next?