pages: CityCouncil/2009-05-19.pdf, 7
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CityCouncil | 2009-05-19 | 7 | (09-206) Financial "State of the City" The Interim City Manager gave a Power Point presentation. Mayor Johnson inquired whether the League of California Cities has taken a position regarding additional cuts threatened to cities if State propositions do not pass. Councilmember Tam responded the League of California Cities has taken a very strong, strident position that the State should be balancing its budget with State funds instead of counting on cities the League has launched a campaign to garner support for coalition partners that depend so heavily on cities to provide some safety net programs cities can adopt a Resolution of Hardship if payroll cannot be made without declaring bankruptcy. The Interim City Manager stated forty cities within California have stated they would experience financial hardship if the State borrows money from them; many cities do not have cash reserves ; the convoluted logic is that cities could borrow cash with interest from the State for money that the State took from cities. Councilmember Gilmore inquired whether the obligation to the State would be discharged if a city filed bankruptcy, to which the City Attorney responded in the negative. Councilmember Gilmore stated bankruptcy is a creature of federal law. Mayor Johnson stated cities need to review the City of Vallejo's [bankruptcy] case. Councilmember Tam inquired whether the City could be eligible to pass a Resolution of Hardship. The Interim City Manager responded there is no criteria stating that a city has to be in a certain dire state to pass a Resolution of Hardship; stated the idea behind a Resolution of Hardship is that every dime in the reserve cash balance has been spent and the city is operating on negative cash. Councilmember Tam stated cities would be penalized for prudent financial management. The Interim City Manager stated the City would have to stay frosty for the next few weeks to see what happens with the propositions. Regular Meeting Alameda City Council 7 May 19, 2009 | CityCouncil/2009-05-19.pdf |