Ryan Hagen, Staff Writer
Posted: 11/03/2012 01:01:30 PM PDT

Special Section: San Bernardino

SAN BERNARDINO – City representatives and their major creditors will meet in court for the second time Monday morning after CalPERS and others objected that the city didn’t qualify for bankruptcy protection.

The city’s bankruptcy attorney argued in papers filed with U.S. Bankruptcy Court in Riverside on Friday that – contrary to the objections – the city is making serious progress toward a plan to adjust its debts and has demonstrated that it filed for bankruptcy in good faith.

But to finish that process – and to avoid “tens of thousands of dollars in potentially avoidable legal fees and costs” – the city asks for Judge Meredith Jury to set the next hearing for Dec. 21 rather than deciding on eligibility on Monday.

Already, $29.78 million of the projected $45.8 million deficit for this fiscal year has been eliminated, attorney Paul Glassman wrote in an eight-page argument, but he said the city can’t survive just by cutting or raising revenues.

“Absent Chapter 9 protection, the city would be unable to pay its employees, go into uncontrolled default of its obligations for critical city assets such as police cars, fire trucks, and refuse trucks, and could not provide basic essential services to ensure the health, safety and welfare of its citizens,” Glassman wrote.

The next step toward financial stability, a pendency plan, is expected to come up for a City Council vote Nov. 19 or soon after, Glassman said. The city decided to first pass a pre-pendency plan – a set of cuts that Glassman acknowledged involved “spirited and extensive discussions and debates” – then make additional cuts afterward and present that final pendency plan to the court.

One demonstration of how seriously the city is looking at all budget solutions will come at 3 p.m. Monday, when the City Council meets, said City Attorney James F. Penman.

The council will discuss whether to ask the San Bernardino County Sheriff’s Department how much it would cost to have sheriff’s deputies police the city, after rejecting – at least for a time – movements toward outsourcing refuse services, custodial work and park maintenance.

“(Police are) one of our most expensive departments and one of the most important,” Penman said. “Our situation is further complicated by the fact that we are in a situation with such a high crime rate and such a crime problem.”

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