POSSIBLE BANKRUPTCY FILING: A California city that has the second-highest foreclosure rate in the nation is preparing for a possible bankruptcy filing. Stockton would become the nation's largest city ever to file for bankruptcy.
NEGOTIATIONS: Lawmakers are prepping bankruptcy plans in case officials are unable to broker a deal with the city's creditors. City Council members granted the city manager authority to seek Chapter 9 bankruptcy protection in three weeks if there's no agreement.
CONTEXT: Stockton's revenues have declined significantly in recent years while expensive investments the city made failed to produce the desired windfall.