Bankruptcy
Nov. 25, 2025
Cities weigh Chapter 9 as liability pressures strain municipal budgets
Los Angeles, Santa Monica and L.A. County face mounting litigation, pension and budget pressures that raise the prospect of Chapter 9 "debt adjustment," recalling earlier California municipal insolvencies and reforms curbing costly filings.
It's a 5-minute stroll from Los Angeles City Hall and Los Angeles County's Kenneth Hahn Hall of Administration to the Central District Bankruptcy Court in the Edward R. Roybal Federal Building.
Municipal finance lawyers don't want to take that walk. But the question is in the air: Could L.A. go broke?
Los Angeles County and the City of Santa Monica both owe large legal settlements to childhood sex abuse plaintiffs. And over the last two years, the City of Los...
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