Stockton, the small resort city South of Sacramento, California sought bankruptcy protection from its obligations last summer. The bankruptcy filing by Stockton, more than 290,000 residents, has been closely watched by both bond insurers who guaranteed the city’s debt and CalPERS, the state pension fund for public workers.
Retiree health care, financed by most California cities on a pay-as-you-go basis, and pension payments based on union agreements pushed Stockton, along with several other California cities into bankruptcy.
New Stockton mayor, Anthony Silva brought with him armor and a helmet (which he donned) during his unique State of the City address this week. The mayor plead with city residents to join him in helping clean up the city both literally and figuratively. The mayor believes raising taxes is the only way the city will be able to improve safety in the crime ridden city. At over 14% unemployment it is expected that Silva will meet opposition among both the council and residents to his plan.