Local Government Bankruptcy

rodento

Could this happen here:eek:

Pennsylvania's capital, Harrisburg, has filed for Chapter 9 municipal bankruptcy. The filing is being contested in court. It's the sixth city to file for protection in 2011, and raises questions about whether Harrisburg can afford to continue to provide the expected level of services to residents

And when city budgets suffer, sometimes essential services can fall through the cracks: Bridges and roads don't get repaired, budgets for firefighters and police get slashed, teachers laid off, and in a new development, bondholders can get paid off before pension checks go out.

http://www.npr.org/2011/10/20/141557122/cash-strapped-cities-file-for-bankruptcy

Better link here

http://www.reuters.com/article/2011/10/12/us-harrisburg-bankruptcy-idUSTRE79B3IY20111012

Delancey

Not as unusual an occurence in the US as one might think , it's largely a mechnism whereby the city can tear up its employment contracts with municipal workers and make cuts like laying off Police , Firefighters , etc.

SBWife

It's highly unlikely here as our councils get significant funding from the central government. US cities are dependent on local taxes for their budgets.

dfbemt

While not necessarily bankrupt, local government is strapped of cash. Look at how many services have been cut around you - street cleaning less frequently, reduced hours in libraries, more potholes in roads, grass not being cut.

The 2nd property tax has just not produced the income local government requires. New local government charges will be collected centrally rather than locally.

The upcoming budget will see further reductions in funding for local government leading to further reductions in services and privatisation of some eg water. We already have had waste collection privatised.

While bankruptcy will not happen some councils will effectively close down all but their essential services for periods of time in order to balance the books.

Gumbo

SBWife wrote: »

It's highly unlikely here as our councils get significant funding from the central government.

i wouldnt say significant tbh
Dublin city Council gets around 9.5% of its funding from Government sources.

This is funding / grants which are given to Dublin City Council by The Government from a fund called “The Local Government Fund”.

The money comes without a requirement as to how it is to be spent, so in essence it may be spent at the discretion of the local authority. Dublin City Council received about €82.73m (9.54%) from this fund in 2010.

havent got the 2011 figures sorry, but you can assume its slightly less than the 2010 figures.

Riskymove

kceire wrote: »

Dublin city Council gets around 9.5% of its funding from Government sources.

In fairness, DCC gets huge amounts of commercial rates etc by its nature

most LAs are more dependent on central funding

Gumbo

Riskymove wrote: »

In fairness, DCC gets huge amounts of commercial rates etc by its nature

most LAs are more dependent on central funding

yeah thats fair enough, heres the figures from 2010 :

1. Charges For Goods And Services – Dublin City Council provides a number of
services which brings in revenue such as :
• Housing Rents
• Housing Loans
• Non-Domestic Water Charges
• Planning Application Fees
• Fire Tender Charges
• Swimming pool Receipts

Dublin City Council estimate to receive €350.18m (40.39%) from this
revenue stream in 2010.

2. Commercial Rates – These are rates placed on any immovable property such as buildings. Factories, shops, railways and canals. A value is given to each property by the Valuation Commissioners on Ely Place and using a complex formula, an annual rate is placed on the owner of the property which is payable to the city council. Although the City council reduced rates by 2% for 2010, Dublin City Council estimate to receive €282.02m (32.52%) from this
fund in 2010.

3. Specific State Grants – These are grants which are used for a specific servicesuch as higher education grants and the money paid to 3rd level colleges. Dublin City Council estimate to receive €142.49m (16.43%) from this fund in
2010.

4. The Local Government Fund – Dublin city Council gets around 9.5% of its funding from Government sources.

This is funding / grants which are given to Dublin City Council by The Government from a fund called “The Local Government Fund”.

The money comes without a requirement as to how it is to be spent, so in essence it may be spent at the discretion of the local authority. Dublin City Council received about €82.73m (9.54%) from this fund in 2010.

Maura74

rodento wrote: »

Could this happen here:eek:

Pennsylvania's capital, Harrisburg, has filed for Chapter 9 municipal bankruptcy. The filing is being contested in court. It's the sixth city to file for protection in 2011, and raises questions about whether Harrisburg can afford to continue to provide the expected level of services to residents

And when city budgets suffer, sometimes essential services can fall through the cracks: Bridges and roads don't get repaired, budgets for firefighters and police get slashed, teachers laid off, and in a new development, bondholders can get paid off before pension checks go out.

http://www.npr.org/2011/10/20/141557122/cash-strapped-cities-file-for-bankruptcy

Better link here

http://www.reuters.com/article/2011/10/12/us-harrisburg-bankruptcy-idUSTRE79B3IY20111012

The UK government are trying to do the same, no more contracts, no more agency workers. At present employees have to be in post for 12 months in UK before they have any kind of protection regarding being sacked, without a good readon, if less than 12 months in post they employers can just sack employee for any kind of reason. The Lib/Con government are supposed to bring this up to 24 months to give employers more time to sack employees. However, they have come up with a better solution such as sacking employees without an explanation regardless how long a person has been employed by a firm.


http://www.bbc.co.uk/news/uk-15456585