By Todd McCune Bray, Riptide Correspondent
After Vallejo's bankruptcy in 2008, the State of California passed Assembly Bill 506, which allows a municipality to restructure its debts with creditors and renegotiate employee contracts without declaring bankruptcy, thereby saving its bond ratings from the consequences of a formal Chapter 9 bankruptcy.
The City of Pacifica has taken the first step necessary for this by declaring a fiscal emergency. Whether intentional or not, our city can now aggressively bring down the cost of senior staff, department heads, fire and police, and potentially restructure its debts with creditors, including fines like the one agreed to in the recent $50 million settlement with the water board.
As of now, AB 506 seems to me like the best option for our city. Correct me if I am wrong, but of all those financial task force options, none of them included a reference to the restructuring AB 506 would afford our community.