Straight outta Compton

Buds Spuckley

Registered User
Mar 17, 2008
895
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#1
Comes a nigga with a bankruptcy.

http://tinyurl.com/86s95re


(Reuters) - The City of Compton, a city of 93,000 people located on the outskirts of Los Angeles, must decide by September 1 whether to seek bankruptcy, according to its two most senior financial officials.
Such a move would see it join a growing number of deficit-hobbled California cities that have used the filing to restructure onerous debt loads.
Compton, which has an accumulated $43 million deficit and has depleted what had been a $22 million reserve, will run out of cash to make its payroll on September 1 at its current cash consumption rate, city comptroller Steven Ajobiewe told the city council during a July 17 meeting.
"I have $3 million in the bank and $5 million in warrants due in the next 10 to 12 days," said city treasurer Doug Sanders. "By then, the council will have a decision to make: don't pay the bonds, default on them, or have a serious talk about bankruptcy."
The city council adjourned at 11 pm without discussing a potential bankruptcy filing.
Compton Mayor Eric J. Perrodin also said he brought unspecified charges of "waste, fraud and abuse of public monies" to California officials, and had met with auditors from both the state and Los Angeles County.
He told the city council that at one point in its past the city had overspent legally set limits on certain programs by $17 million but would not elaborate.
Neither the state nor county has started an audit or investigation, city officials said.
A bankruptcy filing would follow one by San Bernardino, which on July 9 became the third California city this year to seek restructuring of its liabilities. Earlier, Stockton and Mammoth Lakes also said they would file.
Compton's problems escalated on July 13 when credit rating agency Standard & Poor's said it may cut Compton's BB long-term and underlying ratings for its lease revenue bonds.
S&P cited a decision by Mayer Hoffman McCann, the city's independent auditors, to resign rather than sign off on Compton's 2011 financial statement.
Mayer Hoffman McCann did not return phone calls and e-mails seeking comment.
S&P gave the state 90 days to produce certified audited financials, said city controller Ajobiewe, who said the rating agency could withdraw or suspend its ratings on as much as $70 million in city bonds.
Ajobiewe said he had found no other auditing firm willing to step in. City treasurer Sanders said the city had made little progress on a short-term line of credit.
The city council added to Compton's accumulated deficit on July 10 when it adopted a $161 million budget with a $9 million projected deficit.
The red ink grew to $10 million during the council meeting, when city maintenance officials said they needed to make $1 million in immediate repairs to the city's water system to bring them up to code and avoid fines from LA County health officials.
Mayor Perrodin was more optimistic than his financial staff that the city could avoid bankruptcy, although he noted similarities between Compton and San Bernardino, which has a population twice that of his city.
Unemployment is worse in Compton than San Bernardino, he said, although both have seen property taxes fall precipitously due to rising home foreclosures.
Unlike San Bernardino, which has a large unfunded liability to pay its employees' pensions, Compton years ago increased its property tax to fund its workers' pension obligations, said Perrodin, and the retirement program is fully funded.
"Those other cities that went bankrupt all had huge pension liabilities that they couldn't meet," said the mayor. "Even so, we're in pretty dire straits."
(Reporting by Ronald Grover; Editing by Catherine Evans)
 
Feb 5, 2003
5,558
923
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With a stranger
#2
Isn't it amazing that the great state of California is having such awful financial problems on both the state and local level? All the Hollywood liberals who love to tell the rest of the country how to run things (and who knows more about economic policy than actors?) can't run their own state or their own municipalities. Keep on over-regulating everything, CA. Eventually it's bound to work!
 

whiskeyguy

PR representative for Drunk Whiskeyguy.
Donator
Jan 12, 2010
36,423
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Northern California
#3
Isn't it amazing that the great state of California is having such awful financial problems on both the state and local level? All the Hollywood liberals who love to tell the rest of the country how to run things (and who knows more about economic policy than actors?) can't run their own state or their own municipalities. Keep on over-regulating everything, CA. Eventually it's bound to work!
It's even worse if you live here, because this is a giant state that is largely controlled by two or three populated areas, and so many of the policies they push through make absolutely no sense for the other areas of the state.
 

NuttyJim

Registered User
Feb 18, 2006
14,021
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#4
How could a place full of fried chicken jernts, gas stations and liquor stores go bankrupt?
 

Owenay

Those who fail to learn from history are doomed...
May 10, 2007
3,666
248
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Bizarro World
#5
Straight outta Compton? More like straight outta Money. Har har har...
 

NuttyJim

Registered User
Feb 18, 2006
14,021
6,366
638
#8
All the money has been spent on Menthols, Malt Liquor and Scratch Offs
 

the Streif

¡¡¡¡sıʞunɹɹɹɹɹɹɹℲ
Donator
Aug 25, 2002
15,174
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In a hot tub having a snow ball fight.
#9
How could a place full of fried chicken jernts, gas stations and liquor stores go bankrupt?
Maybe if the city was taxing watermelon and red drank like they do the gas out there they wouldn't have head to file for bankruptcy.

They may have wound up with a budget surplus......