Bankrupt Calif. city hires twice-bankrupt manager
Officials knew that experienced city manager owed $620,000 and lost his house in February 2011.
Bankrupt San Bernardino, Calif., has hired a new city manager with professional experience getting cities out of fiscal jams and personal experience getting deeply into debt — he has twice declared personal bankruptcy.
The financial problems of the city of 210,000 in Riverside County, about 65 miles east of Los Angeles, are seen as a national test case that pits worker pensions against Wall Street bond holders.
Over the past 30 years, Allen J. Parker has served as city manager or redevelopment director for other communities in California and Illinois.
On Feb. 15, the San Bernardino City Council hired the 71-year-old Parker — at an annual salary of nearly $222,000 — knowing that he and his wife had declared bankruptcy in February 2011, The Press-Enterprise reported. They owed creditors more than $620,000, and had assets, including a house, worth $170,000, according to U.S. Bankruptcy Court records.
City officials also knew about Parker’s 1991 bankruptcy in San Mateo, south of San Francisco, and that in 2010 he was removed from the Banning Heights Mutual Water Co. after shareholders sued him and other board members for trying to sell the private utility, Reuters reported.
Parker, of nearby Beaumont, told The Press-Enterprise that his financial problems and the city’s were “apples and oranges.”
He said he told the council he had “gone through bankruptcy and, as part of that, I gave back the house — it wasn’t foreclosed on — and that’s all I told them.”
According to the 2011 bankruptcy filing, the Parkers’ debts included two home mortgages totaling $267,500, and bank and credit card debt of $137,252.
City Attorney Jim Penman said that as part of a background check, his office interviewed some of Parker’s creditors.
“The council spent a lot of time, as did the mayor, discussing that issue with him, and the mayor was comfortable enough with his answers to appoint him, and the council was comfortable enough to confirm him,” Penman told The Press-Enterprise. “I would not want people to think this is something we were not aware of.”
The article does not address the 1991 bankruptcy or Parker’s ouster from the water company, which serves about 250 customers in the tiny unincorporated community in the high desert east of San Bernardino.
Reuters’ report said Parker’s resume does not mention his tenure as a director and president of the Banning utility, which serves Beaumont.
Previously, he served as city manager in such California communities as Compton, East Palo Alto, Half Moon Bay and Seal Beach, as well as the Chicago suburb of Oak Park, Ill. For the past six years he had run an economic-development consulting firm.
His first day on the San Bernardino job was Wednesday.
Here’s some of what a Press-Enterprise columnist wrote after the city council voted unanimously to hire Parker:
San Bernardino’s new city manager has ample experience pulling municipalities back from fiscal cliffs.
Oak Park, Ill., was a year and a half from bankruptcy when Allen J. Parker was recruited to instill financial discipline in the Chicago suburb in the early 1990s.
Seal Beach – on the Orange County coast – also was having financial problems when Parker became city manager there in 1981.
He told the writer that “his experience ‘pigeonholed’ him as a fiscal fixer — someone who could take struggling cities and steer them out of troubled waters.”Bankrupt Calif. city hires twice-bankrupt manager.