Capitol Alert
The latest on California politics and government
June 2, 2011

Union-backed legislation that would make it more difficult for local governments to file for bankruptcy protections sailed out of the Assembly Thursday despite opposition from local officials and business groups.

Assembly Bill 506 by Assemblyman Bob Wieckowski, D-Fremont, is the latest incarnation of a political battle stemming from the bankruptcy of Vallejo and warnings by other local governments that they are flirting with insolvency.

Unions fear that contracts and even pension benefits could be abrogated by bankruptcy and have been seeking legislation for several years that that would make it more difficult.

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