Saturday, May 24, 2008
Major U.S. city defaults on debt
Telegraph: Californian city of Vallejo declared bankrupt
An entire Californian city in the once-booming Bay Area has become the latest victim of America’s property crash when its elected leaders declared bankruptcy.
The fate of Vallejo has sent shock waves across the country
Vallejo’s municipal leaders signed off on exorbitant wage deals during the flush years of the real estate boom. However, a crippling 26 per cent was wiped off the value of house prices in Vallejo over the 12 months to March, sharply reducing takings from property taxes.
Posted by little professor @ 06:11 PM (385 views) Add Comment
3 Comments
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1. Jin said...
"An average Firefighter on $171 000"
Whoa?!?
No wonder they're bankrupt, I'm in the wrong job in the country.
2. it_is_going_with_a_bang said...
"Vallejo’s municipal leaders signed off on exorbitant wage deals for its emergency services workers, whose salaries and benefits account for 80 per cent of the annual $89 million budget. The police captain earns more than $300,000 and a sergeant takes home $240,000. The average firefighter earns $171,000 and 10 senior officers were paid more than $200,000 each."
Can you imagine the pension bill on top of this.
Little wonder they took the bankruptcy route.
3. uncle tom said...
Looks like the emergency services orchestrated a scam - no sane person would have given them that level of remuneration.
As to pensions, well, if there's no ring-fenced pension fund and the city has gone bust, I doubt any pension promises will be honoured..