Saturday, June 2, 2012

Stockton Councilman exposes plan to get out of Bankruptcy

Dale Fritchen

By Scott Smith
Record Staff Writer
June 02, 2012 12:00 AM
STOCKTON - Councilman Dale Fritchen on Friday unveiled his plan to rescue Stockton from bankruptcy, a plan he said will balance the city's deficit budget without laying off any police officers.

Fritchen's plan - delivered to The Record - trims $20.5 million from the projected $26 million deficit to Stockton's general fund.

Fritchen drew criticism from Vice Mayor Kathy Miller for using Stockton's dire finances for political gain. Fritchen waited until the weekend before his Tuesday primary race against challenger Michael Tubbs, Miller said.

Coming sunday

The eyes of Wall Street and finance offices across the country are on Stockton as mediation plays out and the city tries to avoid bankruptcy. The bond market viewpoint: Play hardball, wait and see and look for any advantage.

"I think this is too serious of an issue to be used for politics," said Miller, accusing Fritchen of grandstanding. "I'm really disappointed."

Fritchen proposes reducing or cutting several areas of the budget. Among his ideas:

» A 5 percent cut across city employees' pay and benefits for a $7.6 million saving.

» Modify the city's retiree health care by $4.5 million.

» City Hall should be able to negotiate its way out of $1.1 million in annual payments to itself from the settlement of a Howard Jarvis Taxpayers Association lawsuit.

» Rein in payments to outside lawyers and consultants, which could net another $1 million.

Stockton has until June 30 to pass a balanced budget.

City Manager Bob Deis has said the deadline for success in mediation is June 25, or bankruptcy will follow the next day.

Bankruptcy, Fritchen said, will cost Stockton up to $20 million in lawyers' fees.

"There's going to have to be cuts if we go into bankruptcy or not," Fritchen said. "Outside of bankruptcy, there are no attorneys' fees."


Miller declined to comment on Fritchen's numbers because she hadn't seen them, but she said the city's retirees have not yet agreed to reduced benefits in mediation. She didn't see a way to execute that part of Fritchen's plan.

She added that Fritchen and the other council members have been privy to Stockton's financial data for months, yet only now did he present his options to the newspaper.

"I can't tell you they are legitimate savings," Miller said. "It's easy to throw numbers out there from 50,000 feet."

Fritchen said he plans to present his proposal to the city, but it was too late Friday to get them on Tuesday's agenda. He also plans to post them on his website at

"There will always be those who want to criticize others' intentions," he said. "My motivation is, and always has been, to save Stockton from the misery of bankruptcy."

Contact reporter Scott Smith at (209) 546-8296 or Visit his blog at


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