Bankruptcy 'last resort' for Rhode Island city
Bankruptcy has claimed another victim - this time the entire city of Central Falls in Rhode Island. It was the last resort for the financially troubled city.
(Page 2 of 2)
Benson said: "That's what we wanted to do almost a year and a half ago. It can't be any worse than it is. It just can't."Skip to next paragraph
Subscribe Today to the Monitor
U.S. Bankruptcy Judge Frank Bailey of Massachusetts has been named the judge in the case. Flanders said he hopes to have a plan of recovery to present to the judge within 30 days in an effort to prevent a protractedbankruptcy. Ideally, he said, Central Falls would get into and out of bankruptcy in six months.
Democratic state Sen. Elizabeth Crowley, who represents Central Falls, called the bankruptcy filing premature, saying Flanders should have given retirees more time to consider the concessions and offer up a counter proposal. Nearly 60 of them had asked for additional time.
Once the city's finances stabilize, she said officials should look at ways to make up for lost pension benefits, possibly by negotiating new pensions.
"These numbers represent Joe and John and Jane and Mary," said Crowley, a life-long resident of city. "These numbers are people, and I'm not going to let anyone forget it."
Acting Fire Department Chief John Garvey said negotiations with Flanders had been ongoing and that department employees had agreed to what he called "sizable" cuts.
"When you're negotiating, you can't give up everything," he said. "Do you want us to apply for food stamps after you make the cuts?"
He said the department cannot withstand any layoffs without risking public safety.
Municipal bankruptcies are relatively rare, but several jurisdictions have found themselves on the cusp. Jefferson County, Ala., last week postponed a meeting to consider whether to go that route; officials will consider their options Thursday. Harrisburg, Pa., has also been flirting with Chapter 9 in the face of a fiscal crisis.
Democratic state Rep. Agostinho Silva has lived in Central Falls for 27 years. He said he worries that no matter what happens in bankruptcy court, someone is going to pay — literally and figuratively — for the city's financial problems. Tax increases and service cuts hurt residents, he said. Layoffs or pension cuts hurt city workers and retirees.
"One way or another someone is going to get hurt," he said. "I just want what's best for the city and to make sure our residents are not overlooked."
He said he doesn't want to see Central Falls dissolved or merged into a neighboring community like Pawtucket.
"I want to make sure the city keeps its identity," he said. "People are very proud of Central Falls. We know we have our problems. But it's our city."
Pete Zabek, 59, who has lived in Central Falls his whole life, pointed fingers at the city's elected officials.
"I think you can blame these mayors who have been on the watch all these years," said Zabek, who was forced to retire from warehouse work in 1986 because of a disability.
"Somebody's got to do something," he said of bankruptcy. "It's going to take a long time to straighten this mess out."