Brown Signs Bill to Limit California’s Municipal Bankruptcies
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Municipal bankruptcies will face new hurdles under a bill signed by California Governor Jerry Brown in the wake of the Vallejo fiscal meltdown and the earlier Orange County debacle.
After the law takes effect in 90 days, municipalities in the most-populous state will have to submit to a neutral review of their finances, or demonstrate a fiscal emergency, before seeking Chapter 9 bankruptcy protection in federal court.