Bankruptcy is most often used as a way for individuals and businesses to either discharge debts or reorganize them into a more manageable payment plan. But governments, particularly cities and counties, can declare bankruptcy as well for the same reason: unmanageable levels of debt.<\/p>\n
Municipal bankruptcies are fairly rare. They have happened at the rate of about one per year since the Great Depression. But in the wake of the U.S. and global recession of recent years, the filing and\/or consideration of municipal bankruptcies have become an ever-present part of the news.<\/p>\n
Last year, the controversy in Detroit, Michigan dominated headlines for weeks. The city filed for bankruptcy, but the legality of the filing was in question for almost a year. Detroit filed for Chapter 9 bankruptcy on July 18, 2013. The next day, judge Rosemarie Aquilina ruled the filing violated the Michigan Constitution by interfering with pension payments. She ordered Michigan (more…)<\/span><\/a><\/p>\n","protected":false},"excerpt":{"rendered":" Bankruptcy is most often used as a way for individuals and businesses to either discharge debts or reorganize them into a more manageable payment plan. But governments, particularly cities and counties, can declare bankruptcy as well for the same reason:…<\/span><\/p>\n