Stockton, Calif., the biggest U.S. city to have filed for bankruptcy, forecasts $840,000 more in revenue for the current fiscal year than its officials initially anticipated, one sign of how local revenues in California are picking up after several years of declines, Reuters reported yesterday. How the modest increase plays out for Stockton, which has a $155 million annual budget, remains to be seen as the city of 300,000 is preparing a plan for adjusting its debt after recently winning court approval to press on with its bankruptcy case. Other California cities have outlined more substantial revenue gains as the state’s economy gradually improves. But the budgets of California cities, which shocked the $3.7 trillion municipal bond market last year with three bankruptcies filed in a matter of few weeks, will remain tight and face long-term fiscal challenges from pensions and healthcare costs.
