Compton's city finances in shambles
Vowed not to file for bankruptcy
COMPTON, Calif.—Compton’s finances are in a shambles.
They’re in such disarray that the city amassed $369,000 in late fees over the last year because it could not pay its policing contract with the Los Angeles County Sheriff’s Department on time, the Los Angeles Times reported today.
The city has already laid off about 15 percent of its workforce, and city leaders warn that more cuts may be on the way. City Hall has slashed spending, even canceling the city’s popular gospel concert.
But most disconcerting is the city’s looming deficit of $39 million, a sum that represents about 80 percent of its annual general fund budget, according to The Times.
Standard & Poor this summer lowered the rating of some of Compton’s bonds to just above junk status. City officials said they’re hoping for a short-term loan or line of credit to get through the year and vowed not to file for bankruptcy.
As city leaders work to turn the city’s finances around, many residents are questioning how things got so bad so fast, according to The Times.
Just a few years ago, the national media were writing about the renaissance of Compton, where new businesses including Target and Home Depot were moving in and crime rates were dropping. But those boom times quickly went bust.
Compton’s new city manager, Lamont Ewell, said in remarks reported by The Times that years of poor decisions coupled with the economic downturn drained $22 million in surplus reserves and left the city with crushing debts.
While cities in California have been hit hard by the recession, Compton is in a small class of cities that have ended up in critical condition. The cuts come at a bad time, with unemployment in the working-class community already at 20 percent.
Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.
—Chinese Proverb
OK, enough of this machismo bravado over money the United States of America already owes.
Here’s the skinny: if there is no miracle on Pennsylvania Avenue by or before Monday, Aug. 1, President Barack Obama will change the entire game by invoking the 14th amendment authority to always pay America’s debts. As commander-in-chief and the highest ranking elected official sworn to protect and defend this country, President Obama will cite this debt-ceiling crisis as a challenge to America’s national security interests, and take charge.
IRVINE - The Irvine-based parent of the Claim Jumper restaurant chain announced today it is selling substantially all of its assets and operations to an existing investor through a pre-arranged Chapter 11 bankruptcy filing to eliminate debt.
The 45 Claim Jumper eateries, which are located throughout the West Coast and parts of the Midwest, will remain open during the reorganization, company officials said.
LOS ANGELES, Calif. — Standard home sales — the kind involving non-distressed properties — rose to a 5-year high last month, and pending home sales climbed nearly 15 percent above the previous month, the California Association of Realtors reported today.
LOS ANGELES, Calif. — Dionne Warwick, one of the most recognizable pop voices of the 1960s, filed for bankruptcy last week citing more than $10 million in tax debt dating back to 1991.
Warwick, 72, made hits out of many Burt Bacharach and Hal David songs and won five Grammys in a 50-year career. The singer is down her last $1,000 in cash and only owns furniture and clothing worth $1,500, according to the Chapter 7 filing in New Jersey.
