Wednesday Mar 14 2012
Lincoln not headed for bankruptcy, city officials say
By: Stephanie Dumm News Messenger Reporter
City officials say Lincoln is not going bankrupt, in light of a March 1 Wall Street Journal article. The article, “California Cities Hit the Wall,” compared Lincoln to California cities Stockton, Hercules and Vallejo, The Wall Street Journal reported Stockton is taking steps toward bankruptcy, and Vallejo declared bankruptcy in 2008. Lincoln Mayor Spencer Short said “absolutely not” Monday when The News Messenger asked if the city of Lincoln is going bankrupt. “While we have to always look at every option that is available, that is one we hopefully won’t have to take,” Short said. “It really depends on a number of factors and whether my colleagues on the council will support significant budget decreases this year.” Short said the bankruptcy of Stockton and Vallejo “made some sense.” “What you could do was wipe out contracts that were problematic. Both Stockton and Vallejo had very rich contracts for public safety,” Short said. “We’ve already been successful in getting concessions from our employees, and I think that’s the big difference between Stockton, Vallejo and Lincoln.” If the city had taken not action to bring finances under control, according to Lincoln Assistant City Manager/Chief Financial Officer Anna Jatczak, “then that would be a possibility.” “We are aggressively counteracting that so we are continuing to reduce expenditures,” Jatczak said. “We’ve acknowledged that we’ve got a structural deficit like a lot of other California cities, but in no way, shape or form are we anywhere near where Hercules and Stockton are.” Jatczak said the city continues to make payroll and debt services and will be working with the city’s six unions “to obtain concessions.” “We’ve taken some pretty aggressive actions over the past years to make sure we are not continuing to slide down that slippery slope,” Jatczak said.