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Also this hour we're awaiting a ruling from a judge now to see -- the largest US city will file for bankruptcy that Stockton California.
This city of 300000.
It's racking up about 700 million dollars in debt so far in the those pension obligations the city's biggest headache.
-- claims a 26 million dollar budget shortfall last summer.
And the city's unemployment rate is staggering eighteen point 7% even to this day.
-- -- live in San Francisco the ruling could set a precedent.
Well potentially -- it could because it could test whether federal bankruptcy law trumps the California law.
That says debts to the state pension fund must be honored.
Stock and wants to deep -- on a 165.
Million dollar loan it took out back in 2007.
Money that it used to pay helpers at the California public employees retirement system.
Those pension obligations around 900 million dollars represent the city's biggest debt.
And during a three day hearing in federal court last week creditors argued it's unfair for them to lose money.
While the retirement fund negotiated back when times were good remains untouched.
Again this is the first bankruptcy case to challenge state pension law and almost experts predicted the judge will allow Stockton to enter into bankruptcy.
And they expect the ruling will.
-- appeal so -- Stockton officials though there saying there is no other way is that right.
That's what they're saying they'll remember -- filed for bankruptcy last summer officials say they cut services and programs anymore.
It will risk the health and safety of the people who live there.
Stockton after years of good times was hit hard by the housing bust.
Unfunded pension liabilities and bad management it was really a perfect storm their crime is a problem.
You mentioned the high jobless rate city officials claim they have cut budgets and services to the bone.
But all long list of creditors and here you see some of them including bond insurers.
Argued the city did not negotiate in good faith and could have done more like raise taxes to avoid chapter nine.
Now if the judge to grant bankruptcy there will be more negotiations to work out -- debt repayment plan.
A lot of people won't get nearly the amount they were promised and -- we could see this case and up.
At the US supreme -- back to the start in Stockton.
What -- -- and what a time flooding towns live in San Francisco and.
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