Editor's Note: This story originally appeared on AdvisorOne, a sister site of PC360.
Bankruptcy was once a last-ditch act reserved for companies and individuals. Declaring that creditors could not be paid carried a stigma that no one wanted to be associated with—and rarely would a municipality file for Chapter 9, the city version of Chapter 11. How times have changed.
Since 1981, 42 U.S. cities and towns have filed for bankruptcy. The pace has picked up with 10 in the last four years and many others teetering on the brink of insolvency. Recent cities taking the plunge include Mammoth Lakes and Stockton in California, and Central Falls, R.I.
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