Proposed Illinois Law Allows Municipalities to File Chapter 9

TWL_2015_jan_blog20Struggling municipalities in Illinois may finally get the debt relief they have been anxiously seeking. Earlier this week, Representative Ron Sandack (R-Downer’s Grove) introduced HB 298, which would amend existing municipal code to allow a city, village or incorporated town to file for Chapter 9 bankruptcy relief.  With municipalities in other states taking advantage of Chapter 9, local government officials have been working for months to formally sanction Chapter 9 in Illinois. During the annual conference for the Illinois Municipal League, Rockford Mayor Larry Morrissey said, “I’m a big advocate of giving municipalities the same tools that have helped the private sector bounce back and reset. If it’s good enough for Chrysler and GM to restructure and become profitable again, it should be good enough for municipalities.”

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Image Source: Simon Cunningham