City of Vancouver at risk of bankruptcy, says mayor

Vancouver (and potentially other BC municipalities) are not in "trouble" because of a lack of money. They are in trouble due to a "technicality" in legislation. The City of Vancouver has over $1 billion in reserves. To put it into perspective, the City's reserves equal just about one years' worth of City revenues. The City Charter does not allow the City to run a deficit. Deficit means revenues are less than expenses in a period (that period technically being a year). That means, when revenues go down, and you can't raise more revenue, by it's own Charter, they must cut expenses (i.e. lay off staff, reduce services, etc.) so at the very least revenues equal expenses (i.e. no deficit for the year). Think about a company, let's say Apple. Assume they cannot sell as many iPhones, iPads, etc. Naturally their revenues go down. Let's say their revenues go down to a point that they can't cover all of their expenses. They can absorb that deficit for a period of time because they literally have billions upon billions of cash on hand. Now, the City of Vancouver does not have nearly has much cash as Apple, but they do have cash to absorb a deficit situation (for a period of time). But again, they are not allowed (by law) to run a deficit. So it's like their reserves might as well be zero. They can use it, but if they can't even run a deficit to begin with. See the problem? Reserves are like savings, unfortunately, they are not considered revenues. Therefore, if revenues go down to the point where revenues are less than expenses, even though the City can fund that deficit temporarily through it's own savings - they will still be violating their own Charter by running a deficit to begin with - because savings (although savings can be in the form of cash), it's still not considered revenue.

The options:
1) I'm not going to waste my time and read the entirety of Vancouver's Charter. But if there is a mechanism to change the Charter so that City Council can operate in a deficit, that's an easy solution. Other municipalities are also in the same boat because the provincial legislation that created the various cities/townships/municipalities have the same stipulation (you can't run a deficit).
2) The BC Government can amend provincial legislation to allow cities to run deficits. This won't help Vancouver. Also, the Provincial Government is unlikely to amend the legislation to allow all cities to run deficits.
3) A "bail-out."

The provincial and/or federal government will bailout certain cities, if and only if they need to. They just don't think they need to, at this time.

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X-Files said:

"The City of Vancouver is at risk of going bankrupt, says the mayor, citing a recent poll showing more than half of property owners are not expecting to pay full property taxes this year as COVID-19 financial woes take hold.

In a press release issued on Sunday afternoon, Mayor Kennedy Stewart said his earlier claim that the city would lose up to $189 million in revenue and fee shortfalls in 2020 could be as much as $325 million short of the mark. The city has already laid off 1,500 workers.

...Over one million Canadians have so far applied for the federal government’s $2,000 a month COVID-19 emergency benefit.

...“It’s illegal for Vancouver and other local governments to run deficits, so the only way we can stay afloat is with the help of the federal and provincial governments. Otherwise, local governments will be forced to take drastic measures that will hurt residents and businesses, and significantly slow any post-pandemic economic recovery.”

https://vancouversun.com/news/covid-19-city-of-vancouver-at-risk-of-bankruptcy-says-mayor/

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RED EYE said:

my threads with talks of a depression are appropriate

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X-Files said:

Sure, why not. Otherwise wouldn't they be in the RR or nuked.

Doom & gloom stuff about the future of the economy & conspiracy theories, etc, appear to be quite appropriate in this particular forum.

As for the OP, if Vancouver city really has one billion dollars in reserves i intuit it will be just fine.

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RED EYE said:

I hope the money is there. Im hoping everyone is fine and gets to the other side. My issue has been pretty clear..You have a very good chance of seeing this country go into a depression.. And a depression will be far worse than the Chinese virus itself.. I wish it wasn't the case , but afraid it will be

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