It's more than a bit of hyperbole when San Juan Capistrano's critics describe the city as nearly bankrupt, but here's one community that is in serious financial trouble:
from www.latimes.com:
Compton's financially struggling City Hall may have to shut down if the City Council doesn't approve a new budget Tuesday night.
The council in recent weeks has twice voted down a budget that would lay off dozens of employees, including several department heads.Those voting in the majority said they wanted to see alternatives to layoffs.
City officials including City Manager Willie Norfleet and Mayor Eric Perrodin said last week that without a budget, a government shutdown could be imminent, with all city employees involuntarily furloughed except for public safety workers and other essential staff. City Treasurer Douglas Sanders said that he would not issue city paychecks this week if there was no budget appropriating the funds. City employees received notices weeks ago warning that their paychecks might be delayed.
Unions representing city employees have threatened to sue if the budget calling for layoffs is adopted. The unions contend that a resolution passed in 2009 gives the city authority to keep functioning until a budget is passed. City officials, however, said they did not have authority to operate without a budget under the city’s charter.
The city's fiscal situation is dire. Its general fund has been running deficits for the last three years. The city’s independent auditors, citing the deficits and “liquidity problems,” have questioned the government's ability to remain solvent. According to a report provided by the city, Compton’s general fund ended the latest fiscal year with a deficit of about $23 million, equal to about 40% of the city’s budget for the period. The deficit was inflated by $11.6 million because money was transferred from the general fund to pay off an accumulated deficit in the city’s general liability fund.
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