Cities in Distress

In a growing number of U.S. cities, deteriorating economic conditions have put in jeopardy standard public services most Americans take for granted: potable water, police and fire protection, public schools, etc.... National headlines in recent years provide ample evidence of cities in distress. While debates about Flint, Michigan and Ferguson, Missouri have understandably emphasized water quality and police misconduct, respectively, these communities share a common condition of fiscal deprivation that helps explain their current circumstances. Similar conditions underlie several high-profile cases of municipal bankruptcy in recent years (e.g., Detroit, Stockton, San Bernardino). The origins of these local fiscal crises are complex and varied, but most can be traced to budgetary pressures arising from some combination of shrinking tax bases, constitutional limitations on local taxing authority, legacy pension costs, and reduced federal and state financial assistance.

This course will examine the root causes of the fiscal crises in these and other cities, and explore the various legal tools available to assist these communities in achieving long term fiscal sustainability. Specific topics to be covered include the basics of local government finance, structural trends contributing to local fiscal distress, and legal mechanisms for addressing fiscal crises (e.g., financial control boards, municipal bankruptcy, dissolution). Attention will also be given to federal, state, and local fiscal reforms designed to reduce the risk of future crises.