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About a 20 minute drive from my office is Broke Town, USA.

I’m referring to Vallejo, California, which declared municipal bankruptcy.

Vallejo would have seemed to have everything going for it. Beautiful views of the San Francisco Bay. A ferry that crosses the bay to the financial district. Many of America’s greatest wineries are 30 minutes up the road in Napa Valley. The islands and waterways of the delta are nearby.

But Vallejo is broke. Like so many other cities and town that lack sufficient revenue to fund their schools, police and other basic services.

And we’ll likely see the state shifting some money but more obligations back to localities.

As the costs of healthcare coverage go up and more people are uninsured, many of those localities are the last resort for healthcare.

Seen against this background, our workers’ compensation system seems
quite stable. But if city after city descend into financial meltdown, the impact on workers’ comp could be hard to predict.

For a good article on Vallejo’s plight, check the piece by Roger Lowenstein in The New York Times:
http://www.nytimes.com/2011/03/06/magaz … WL8jrpon6w

Stay tuned.

Julius Young
www.boxerlaw.com
www.thecompguys.org

Category: Political developments

Julius Young

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