Bill > LD2009

This bill allows counties and municipalities in Maine to file for federal bankruptcy protection under Chapter 9 of the United States Bankruptcy Code, but only after meeting three specific conditions: first, the county or municipality must have exhausted all reasonable alternatives to resolving their debt obligations; second, the State Auditor must officially determine that the local government is insolvent (meaning unable to pay its debts); and third, a majority of county commissioners or municipal officers must vote to approve the bankruptcy petition. The bill recognizes the challenging financial circumstances facing local governments, including rising property valuations and increased living costs, and is designed to provide an additional financial management tool. The legislation is considered an emergency measure, which means it will take effect immediately upon approval, bypassing the typical 90-day waiting period for new laws in Maine. By establishing clear criteria for bankruptcy filing, the bill aims to provide a structured process for local governments facing severe financial distress while ensuring that bankruptcy is pursued only as a last resort.

Government Affairs

https://legislature.maine.gov/legis/bills/display_ps.asp?LD=2009&snum=132