Bankrupt San Bernardino, Calif., warns it may contract out services, raise debt

Reuters reports:

Bankrupt San Bernadino, California, might have to contract out essential services and place a revenue bond on the ballot in 2015 elections after a measure failed this week that would have lowered base pay for police and firefighters, said a lawyer for the city on Thursday.

Paul Glassman, San Bernardino's bankruptcy attorney, told the federal judge overseeing the city's bankruptcy that a rejection by voters on Tuesday of a pay-cutting ballot measure for police and firefighters was a "gamechanger" that had thrown the restructuring plan off track.

Lawyers for San Bernardino's police and fire unions reacted with dismay and anger to what appeared an effort by the city to blame the failure of Tuesday's ballot measure on the city's inability to come close to producing a bankruptcy exit plan, 28 months after it entered Chapter 9 protection.

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