The financial meltdown facing Stockton, California may sink to new depths this week. Today, city officials will announce whether to file for municipal bankruptcy or seek a mediation process to resolve the city's mounting debts. Mike Fitzgerald, a columnist for the local paper The Stockton Record, joins the show to discuss the city's future.
Several years ago, Stockton was booming. The population soared as it drew people from the Bay Area. Building projects multiplied and revenues rose. But with the collapse of the housing market in 2008, Stockton's growth was sharply checked. The recession hit and was made worse by over-extension in redevelopment projects.
City politicians have yet to find workable solutions to the financial crisis. They remain embroiled in a divisive law suit with the city's police force. A fiscal report is due out Feb. 29 and many in Stockton fear the worst.
Vallejo, Calif., which filed Chapter 9 bankruptcy in 2008, looms large in discussions of Stockton's future. As Fitzgerald says, "It stigmatizes the city, realtors have to tell you...the negative declaration that you're going to be buying a house in a bankrupt city, businesses don't want to relocate there... " And like Vallejo, Stockton may face increased crime if the city continues its decline.
Mike Fitzgerald is a columnist for the local paper The Stockton Record.