Chapter 9 Bankruptcy

Chapter 9 Bankruptcy is a legal process that allows municipalities, like cities or towns, to reorganize their debts while continuing to provide essential services to their residents. It helps local governments manage financial crises by creating a plan to repay creditors over time, often reducing the total debt owed. Unlike personal or corporate bankruptcies, Chapter 9 is specifically designed for public entities, allowing them to negotiate with creditors to stabilize their finances without liquidating assets. This process aims to maintain public services while enabling a sustainable recovery.