More Economic Trouble in the Valley – Atwater Going Belly Up
10/06/2012 2 Comments
We used to live in the sleepy town of Atwater when stationed at Castle AFB in the late 1960s. We lived next to the watermelon fields and after the harvest was over we would collect the melons left behind. Ripe watermelon right of the field was the best ever. Agriculture and the Air Force base were the primary economic engines, now the base is gone and Atwater must depend on agriculture.
The small agricultural town of Atwater, Calif., has declared a fiscal emergency, as it seeks to avoid becoming the fourth municipality in the state this year to file for bankruptcy protection.
Located about 100 miles east of San Francisco, Atwater is grappling with a $3 million budget deficit, declining city revenues and cost overruns for a new wastewater treatment plant.
The town on Wednesday declared the emergency, which under state law allows it to restructure union contracts, including imposing salary reductions and benefit cuts without negotiations. “We’re working hard to balance the budget and avoid bankruptcy,” said Joan Faul, Atwater’s mayor.
You can read the full article HERE. Walter Russell Mead concludes:
How many more California cities will follow Atwater? As David Kotok, chief investment officer at Cumberland Advisors, told Bloomberg: “In California, we have a disease, and the disease is spreading. . . . I suspect we’re going to see wholesale warnings and downgrades.”
Our small downs are asking for more taxes, rather can cut spending. With a plethora of tax measures in the ballot, voter with their own economic troubles will most likely reject them all. Then what?