If the Town of Mammoth Lakes files bankruptcy, Mono County will be affected as a creditor. The County provides hundreds of thousands of dollars in services to the Town. County Counsel Marshall Rudolph said a Town bankruptcy could impact the Town’s payment for these services. He has asked for a closed session to talk over these pressing issues with the Mono Supervisors on Tuesday.
Rudolph said, “If the Town files bankruptcy, and at this point everyone assumes that is likely, the County would be a party to the bankruptcy as a creditor.” Rudolph said the County provides dispatch services, the Animal Shelter and IT services which would be subject to cancellation or change under bankruptcy.
The County has taken part in what Rudolph described as pre-bankruptcy mediation sessions with the Town in its efforts to re-negotiate contracts to save money. The County Counsel said these are things he needs to discuss with the Supervisors and get direction. The mediation proceedings are currently confidential as directed by state law. Rudolph did say the Town is trying to get consent from creditors to open up the process.
Rudolph said that County contracts can be re-negotiated, but contract terms are for one year and the County budgets and plans accordingly. For instance, the Town pays Mono County $90,000 per quarter for law enforcement dispatch services. Rudolph said the Animal Shelter involves a Joint Powers Agreement between the County and Town that “can’t just be terminated or negotiated,” he said.
Rudolph added that Mono County has contracted with the Town to pay for services on a direct cost recovery basis. This issue will be discussed in closed session at Tuesday’s Mono Board meeting.