Stockton City Council Approves Bankruptcy Plan

Update Wednesday: From the Stockton Record this morning:

The City Council put Stockton on an irreversible course toward bankruptcy Tuesday night, voting on a measure that will make it the nation’s largest city to seek Chapter 9 protection.

Stockton’s filing with a federal bankruptcy court in Sacramento will come by the week’s end, City Manager Bob Deis said.

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We’re rooting for you, Stockton, but it ain’t looking good, going-belly-up-wise.

Stockton Mayor Ann Johnston told local station KCRA today: “It’s my belief there have been no settlements reached… and no way to avoid bankruptcy.”

The latest from AP: “City officials did not immediately return a request Tuesday for comment about the mayor’s remarks. City spokeswoman Connie Cochran has said the negotiations with creditors, which carried a deadline of midnight Monday, were confidential, and nothing would be announced until the City Council meeting Tuesday.”Yesterday, Mayor Johnston broke the situation down into these basics for NPR’s Richard Gonzales:

“The average person will still see the same police officers, the same firefighters. The city will continue to be doing business. We will pay our local vendor…our employees will be paid.

“There will be some modifications to employee contracts, there will be a reduction of retiree medical health benefits, there will be no payments to some of our major creditors who hold bonds.”

The Stockton Record will be providing live updates from tonight’s 5:30 p.m. city council meeting, at which a vote is expected on what the Record says will be a “measure that effectively sends Stockton into bankruptcy, making it the nation’s largest municipality to have done so.”

And just when Stockton had fallen to No. 11 on Forbes’ most miserable cities list, down from No. 1 last year. That Stockton-as-hellhole meme sparked a defensive backlash in the community; this video, for instance, touted the city’s weather, cultural attractions, waterfront, university, and “wonderful first-time homebuyers’ market,” which, as I wrote last year, is sort of another way of saying that home prices have collapsed, but ya gotta look at the bright side.

Here’s a photo slideshow from KQED’s Ian Hill showing some of the capital projects that Stockton indulged in during better times, but have now helped put the city in the red…