Municipalities: Time To Dust Off Chapter 9?

Law360, New York (February 12, 2008, 12:00 AM EST) -- Fallout from the credit crunch and other factors are conspiring to strain the finances of state and local governments and government-sponsored entities. As a result, in the coming years we may witness an increase in defaults and filings under a rarely used provision of the Bankruptcy Code – Chapter 9.

While similar in many respects to chapter 11, chapter 9 only applies to municipalities and has its own special rules. Investors and insolvency professionals would be well-served to brush-up on chapter 9 before municipal finances crumble...
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