Should city seek bankruptcy relief?
Published 12:00 am Tuesday, May 3, 2016
Those who know me know I am no fan of Mississippi’s archaic state constitution and its anti-progressive stance on almost every social issue of the day. The recent secession petition was not farcical — there are a handful of sections of the Magnolia State that just do not fit in with the ostrich-like closed minded fear and hate that is so pronounced and exemplified by the things that routinely come out of Jackson these days. Thankfully, it happens that Natchez is in the exceptional minority.
But when it comes to matters of tax paying and the public trust, I am indeed a hardliner on transparency, accountability and a level playing field, and believe that continuously educating the local residents is of paramount importance. The fundamental lack of understanding by many in the community of the different roles of the Natchez Convention Promotion Commission and the operations of the Natchez Office of Tourism run by the city has begged public disclosure that must continue until the current situation is fully investigated, vetted, disclosed and fixed, if necessary. Based on documents reviewed, the current arrangement appears so far to be fraught with conflicts of interest and steering of profitable work to a small handful of beneficiaries.
Meanwhile, the city still, after several administrations, still does not appear to be capable of providing the taxpayer and voter “owners” of the city with accurate financial information. Moreover, it appears to meet the definition of insolvency carved out for municipalities in the U.S. Bankruptcy Code, which defines insolvency, as respects a municipality at 11 USC 101(32)(c), as “financial condition such that the municipality is (i) generally not paying its debts as they become due unless such debts are the subject of a bona fide dispute; or (ii) unable to pay its debts as they become due.”
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One need look no further than the annual “tax anticipation loans” to see that the city does not pay its debts as they become due, and that it continues to operate in the blind and does not take care of fundamental business. Surplus properties have not been liquidated, cemetery funds are not accounted for and automobiles are purchased in violation of the Mississippi public procurement laws. Is anyone at City Hall paying attention?
So, my suggestion for the mayor and board of aldermen this week is that they look into filing Chapter 9 bankruptcy and perhaps get a helping hand through the vehicle of the U.S. Trustee’s office in getting all contracts and commitments of Natchez reviewed and possibly use the process to restructure the city’s bond indebtedness, so that critical repairs and renovations can take place at the city auditorium, community center and if justifiable, additions to the convention center, under the watchful eye of the bankruptcy court. The ongoing evidence over the past 12 years is that the City of Natchez simply does not have the resolve to do it itself.