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In opting to become the nation's largest city to seek federal bankruptcy protection, this river port of 290,000 took a rare financial step of last resort after struggling with the economic downturn, soaring pension costs and contractual obligations.

Thirteen cities, counties and other government entities filed for bankruptcy protection last year — the highest annual level in nearly two decades. Stockton was the seventh U.S. municipality to file this year and the first California city since Vallejo, which sought protection in 2008, according to James Spiotto, a Chicago bankruptcy attorney who tracks municipal bankruptcies.

"Filing bankruptcy is time-consuming, expensive and complicated," said Spiotto, noting that Vallejo spent millions of dollars alone on attorneys and other bankruptcy professionals. "And you never get the results you desire."

That's why experts are divided on whether other financially struggling cities, towns and other government entities will follow Stockton to bankruptcy court. Spiotto said it will be hard and expensive for Stockton to obtain financing.