Jan 15 2013

 

 

 

Sanbernardino

Now that we have looked at the 'Five Best Run Cities in America' it is time to look at the worst run cities in America. 24/7 Wall Street has also issued this list of twenty. The top five includes two Southern Florida cities. Orlando, Florida, the home of Disney, is at number ten! Here are the top five worst run cities.

1. San Bernardino, Calif.

- Population: 213,008
- Credit rating: not rated
- Violent crime per 1,000 people: 8.76 (27th highest)
- Unemployment rate: 17.6% (3rd highest)

Few cities were hurt by the housing crisis to the same extent as San Bernardino, where the median home value declined by 57.6% between 2007 and 2011, more than any other large city in the U.S. By the end of 2011, almost 4.4% of homes in San Bernardino were in foreclosure, among the highest rates for all large cities. That year, the unemployment rate reached 17.6%, or nearly double the U.S. rate and almost 10 percentage points higher than city’s annual rate in 2007. In August, declining home values and rising employee retirement costs forced the city to file for bankruptcy. But the city’s filing is being challenged by its largest creditor, the California Public Employees’ Retirement System, which is demanding payments.

2. Miami, Fla.

- Population: 408,760
- Credit rating: A2, negative outlook
- Violent crime per 1,000 people: 11.98 (12th highest)
- Unemployment rate: 12.4% (17th highest)

Between 2007 and 2011, the median home value in Miami fell by 43.5%. Additionally, the city had one of the nation’s lowest median household incomes, at under $29,000, while 31% of residents lived below the poverty line — nearly twice the U.S. rate of 15.9%. Despite the difficult economic conditions Miamians faced, the city joined with Miami-Dade County to pay for almost 80% of the more-than $600 million cost of building a new baseball stadium for the Miami Marlins. The deal has caused significant uproar. While taxpayers pay extremely high costs to service the stadium debt, the team has traded many of its top players. In 2011, the SEC launched an investigation into the agreement.

3. Stockton, Calif.

- Population: 296,367
- Credit rating: Caa3, negative outlook
- Violent crime per 1,000 people: 14.08 (8th highest)
- Unemployment rate: 20.2% (the highest)

Last year, Stockton was unable to fund its pension liabilities and make debt service payments. As a result, it became the largest city in U.S. history to file for bankruptcy. The city had been especially hurt by the recession. Its unemployment rate for 2011 was above 20%, while more than 5% of homes were in foreclosure — both among the highest rates for any large city. Just before the bankruptcy filing, Moody’s downgraded the city’s credit rating to account for the likelihood of a default. Moody’s noted, “The Caa3 rating level assumes losses to bondholders will be greater than 20%. The negative outlook reflects the high likelihood that losses could exceed our estimates.” Not only have the city’s creditors been affected, but so have city employees and retirees. According to NPR, the city may cut health benefits to reduce its $417 million in unfunded liabilities.

4. Detroit, Mich.

- Population: 706,640
- Credit rating: Caa1, negative outlook
- Violent crime per 1,000 people: 21.37 (the highest)
- Unemployment rate: 19.9% (2nd highest)

Detroit was hit hard during the recession, with the near-collapse of the automobile industry and a further slowdown of the already embattled housing market. The median home value between 2007 and 2011 tumbled by 43.5%, or more than four times the rate of decline across the country. The lack of income coming into the city’s coffers in the last few years has led to significant financial difficulty for Detroit. Moody’s currently rates city’s bonds as Caa1, which is considered junk status and the worst-rating Moody’s gave to any major city. Mayor Dave Bing signed a budget that aims to cut $250 million in the 2012-2013 fiscal year, with total spending of $1.12 billion.

5. Hialeah, Fla.

- Population: 229,967
- Credit rating: not rated
- Violent crime per 1,000 people: 3.78 (18th lowest)
- Unemployment rate: 14.1% (tied- 9th highest)

Home prices between 2007 and 2011 fell by 44% in Hialeah, the 10th-highest decline of all 100 largest cities. The median household income of $27,208 in 2011 was the third-lowest of all major cities, after declining by 44% during the recession. Of workers residing in Hialeah, 15.5% worked in the generally low-paying retail trade, the highest percentage of all of the 100 largest cities. As a result of industry composition, nearly 40% of city residents are without health insurance, higher than any other large city in the U.S.