OC Register vs Stanton. Which one actually went bankrupt?


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In a peculiarly disjointed editorial, the OC Register took a shot at Stanton on July 18th, How can Stanton avoid bankruptcy?

The opinion piece started with a few false premises, compared an imaginary bankruptcy in Stanton to the Orange County bankruptcy, reminded readers that the Register opposed an increase in the Stanton utility tax to provide enough money for public safety, and ended with this admonition,

This is a time for retrenchment of government at all levels. Decades of excess finally no longer can be sustained. Stanton and other Orange County cities should not take bankruptcy lightly. It should be a last resort. But as the county of Orange found out 18 years ago, it also can be a new beginning.

Unsurprisingly, Stanton’s Mayor Pro Tem Dave Shawver took great exception to the Register’s advice, and wrote back to them in an opinion piece I don’t expect to see published in our local daily.

So far, only one newspaper in Orange County has been forced to seek bankruptcy protection. It is our own Register. I must presume that the editorial staff of the Register is helping Stanton through their own experiences in bankruptcy.

When you write editorials for a newspaper that has gone bankrupt because of heavy debt loads and depressed advertising revenue, then you can speak as an authority on the matter. I applaud the Register for showing Stanton the solution. They forced their employees to take pay cuts and issued a plethora of layoff notices. Thanks, but no thanks to the staff of a bankrupt business.

Stanton has no debt and we have reserves to help our community. We will have a balanced budget after reducing our level of public safety services and we are not going to follow you into bankruptcy. Maybe we could give the Register some pointers on how to avoid bankruptcy again. The problem was not mismanagement; it is the State Legislature stealing over $11 million dollars annually from our local taxpayers.  I’d love to see the survival plan of your organization with that yearly loss.

We are stable and recovering,  yet next Tuesday we will vote to put a utility tax increase on the November ballot. It is so we do not have to eliminate any more firefighters, police, or paramedics. It will cost an average family  $6 – $12 more a month on their utility bill.

I suppose the Editorial Board will attack us again without knowing what Stanton has accomplished in surviving the last four years.  So bring it on!

Dave has an excellent point. If you look at the recent financial history of the Orange County Register, it reads like one of those Bain Capital stories. Insiders cashing out. Massive debt followed by bankruptcy. Dismemberment of the corporation into its parts. Layoffs, cutbacks and a workforce so demoralized that some of their best writers move on to jobs with public employees unions.

Freedom Communications isn’t alone in its woes, but the last time I looked they were shedding subscribers faster than any other major daily in California. They just do not have a product that people wanted, and their various experiments further diminished what was already a pretty craptastic product.

Maybe the new owners will figure out some new formula that will make more people want their paper, or maybe they will continue their current model of constantly doing less with fewer, even less experienced recent J-school graduates.

But do they really have anyone who should be giving financial advice?

Update:  We have also received a copy of a letter from the Mayor of Stanton to the Register, which also appears destined for the memory hole file at the Register. I love these snippets of Mayor Carol Warren’s angry demand for a retraction,

The basis of the editorial is misleading to the public, the facts presented are inaccurate and the lack of research is reprehensible.To insinuate that the City of Stanton is even considering bankruptcy is immoral and has no basis in reality. It is a straw man created by the editorial board to promote their opinions on tax issues.  While I understand that it may make for good headlines on the heels of the three cities in California filing for bankruptcy protection, the City of Stanton has never considered bankruptcy and has instead made the tough decisions necessary to keep the city’s finances strong….

In the editorial it is also stated that, “The O.C. city in most-dire fiscal peril is Stanton.”  How is it that Stanton with reserves in excess of 55% of annual expenses is the city most in peril, when other cities are cited as having reserves at 1% and 5%?  Again, the editorial board has shown a lack of journalistic integrity by printing misleading statements and failing to research the relevant facts.

Yep, that’s our Register – immoral, reprehensible, misleading, devoid of integrity.


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