Jeremy Hobson: This week, Stockton, Calif. is set to become the largest city in the United States to file for bankruptcy.
Not a good thing, for sure, but as Marketplace’s Shereen Marisol Meraji reports, there is life after Chapter 9 — Just ask the people 70 miles away from Stockton in the city of Vallejo.
Shereen Marisol Meraji: …best known for B-list rappers, a Six Flags amusement park and filing for bankruptcy in 2008.
Vallejo city council member Stephanie Gomes says with bankruptcy came opportunity.
Stephanie Gomes: To just open the books and to show all the problems and admit to them and not defer them and address them, it was a unique opportunity, I think, for a city.
Gomes says Vallejo took the respite from debt to figure out where to cut and ways to boost revenue. And it passed a one-cent sales tax to pad its bare-bones public services.
James Spiotto is a municipal bankruptcy expert. He says bankruptcy is just a band-aid unless cities address their real economic problems.
James Spiotto: With Stockton — the economy, the housing crisis, the need for additional jobs — that isn’t solved by a Chapter 9.
Vallejo’s Stephanie Gomes says four years after filing for Chapter 9, her city is still grappling its biggest problem: the cost of pensions.
I’m Shereen Marisol Meraji for Marketplace.
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