The California city of San Bernardino announced today that it intends to file for Chapter 9 bankruptcy protection. This decision by the San Bernardino City Council is only days after the city realized that it had a mere $150,000 in its bank accounts. According to city officials, that amount barely allows them to make June 15th payroll.
Chapter 9 bankruptcy is a section of the bankruptcy code is a section of federal law that designed to help municipalities that face insolvency through reorganization. It will allow San Bernardino the opportunity to stall creditor payments, protect it from lawsuit judgments over certain amounts of money, and renegotiate the terms of its labor contracts.
San Bernardino is the third California city to announce that it intends to file for Chapter 9 bankruptcy protection in order to deal with its financial issues. The other two cities are Stockton and Mammoth Lakes.
Similar to San Bernardino, many Maryland residents need to reorganize their debts as well through a Chapter 13 bankruptcy. Here at The Law Office of David Cahn, we have counseled many people throughout the great state of Maryland who are worried about their mounting debt, lawsuits, wage garnishments, foreclosures, repossessions, and medical bills. Our Silver Spring bankruptcy lawyers give them honest opinions about their debts. When appropriate, we help them reorganize their debts. We have even turned potential clients away when we think bankruptcy is not the appropriate course of action for them. Our experienced Maryland bankruptcy lawyers also think outside the box and have counseled potential clients to consider options that do not require a lawyer at all.