Chester Chapter 9 Bankruptcy Filed by State Receiver

Money falling from the sky in a city
Image via iStock.

Chester’s state-appointed receiver made it official Thursday.  He filed for bankruptcy on behalf of the city of Chester, writes Kenny Cooper for WHYY.

Michael Doweary hopes that by filing for Chapter 9 of the U.S. Bankruptcy Code, it will give Chester protection against creditors while it tries to fix its debt problems.

He expects the city to have a $46.5 million deficit in 2023, with $39.8 million of that for past due pension payments.

 “Since my appointment over two-and-a-half years ago, I have worked to avoid this day. However, Chester has a severe structural deficit that cannot be addressed by one-time fixes, has unaffordable retiree benefit liabilities, and cannot reliably provide vital and necessary services to its residents,” Doweary said in a written statement announcing the action.

Doweary has asked that a judicial mediator be appointed to find “a consensus solution.”

He added that Chester’s financial and operational problems were the worst his team had ever encountered.

In 2020, Pa. Gov. Tom Wolf declared a “fiscal emergency” in Chester and placed the city under receivership.

Doweary is holding a virtual public meeting Tuesday, Nov. 15,1 p.m. on his office’s Facebook page.

Read more about Chester’s Chapter 9 bankruptcy at WHYY and The Wall Street Journal.

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