HALFWAY TO CONCORD » city of vallejo http://www.halfwaytoconcord.com Contra Costa News, Politics, Business, Events Calendar Thu, 08 Jan 2009 19:34:53 +0000 http://wordpress.org/?v=2.7 en hourly 1 How cities like Vallejo can solve fiscal crisis and avoid bankruptcy http://www.halfwaytoconcord.com/how-cities-like-vallejo-can-solve-fiscal-crisis-and-avoid-bankruptcy/ http://www.halfwaytoconcord.com/how-cities-like-vallejo-can-solve-fiscal-crisis-and-avoid-bankruptcy/#comments Mon, 03 Mar 2008 22:20:01 +0000 admin http://halfwaytoconcord.com/?p=1242 According to the California Foundation For Fiscal Responsibility (CCFR), Vallejo is not facing a municipal fiscal crisis alone in California, it is just the first city to run out of cash. The root cause is promised increases in wages and benefits for government employees that are not supported by tax revenues.

Looking for answers, Vallejo leaders have chosen to reduce services and increase fees to close an $8 million shortfall. The unions have reluctantly agreed to accept smaller raises than provided by their current contracts and they have agreed to personnel cuts. The city is asking bond holders for more time to pay which only increases future interest costs. Spending on infrastructure and much needed road maintenance will be curtailed indefinitely. CFFR recommends immediate adoption of the following steps toward fiscal responsibility:

1. Stop Illegal Payments for Extra Pension Benefits Related to Services Rendered Years Earlier
2. Adopt a Second Tier Pension Plan for New Hires
3. Reduce Compensated Absences
4. Discontinue Allowing Employees to Purchase Years of Service

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