Municipal BK

  The below summary was compiled during December 2017. Since this report was published, the Tax Cuts And Jobs Act was passed and signed into law despite its serious disregard for causing very large increases in our national debt with attendant negative economic consequences.     The second estimate of…

336 B.R. 387 (2006) In re SLOCUM LAKE DRAINAGE DISTRICT OF LAKE COUNTY, Debtor. United States Bankruptcy Court, N.D. Illinois, Eastern Division. January 19, 2006. Michael G. Cortina, Crystal Lake, IL, for Movant. Thomas D. Laue, Chicago, IL, for Respondent. Ira Bodenstein, Chicago, IL, trustee. MEMORANDUM OPINION JOHN H. SQUIRES,…

  Detroit BK The city of Detroit, which filed for bankruptcy July 18th, will continue to pay secured creditors, including water and sewer bondholders, according to credit market analysts. The Detroit Free Press, quoting a local bankruptcy attorney, said an automatic stay will be issued on most of Detroit’s obligations,…

Municipalities and other governmental entities must make arrangements with other municipalities and governmental entities for purposes of infrastructure, capital projects, shared financing and other creative and not-so-creative ideas. What to do? ...    

  … federal bankruptcy legislation did not include a means of handling municipal insolvency and debt adjustment prior to 1934.  During the Great Depression, however, there was widespread nonpayment of property taxes, which municipalities depended upon to fund government services.  (It would probably be useful here to describe how different…

See Timothy Hippa 2009: In difficult economic times, the demands for municipal services increase while revenues from declining property values or decreasing sales tax diminish. For some municipalities or units of local government, the lack of adequate revenues may create a financial disaster. In such a case, a municipality may…