April 20, 2012
By: John Clark
An adviser to the mayor of Providence Rhode Island was fired last week after making what the mayor deemed to be excessively candid remarks about the likelihood of a bankruptcy filing by the indebted eastern city.
The adviser, Robert G. Flanders Jr., was unceremoniously dismissed by Mayor Angel Taveras, who also kicked Flanders’ law firm out of its official advising position, according to a report from Fox News.
In retrospect, the comments made by Flanders to Bloomberg News last month seem relatively harmless, but they seem to have struck a chord in the mayor’s mind.
When discussing the odds that Providence could escape its debt woes without bankruptcy, Flanders reportedly told Bloomberg News that he didn’t "see how they can get out of without going" into bankruptcy.
I response to Flanders’ remark, Mayor Taveras called the comment "unacceptable” and decided to sever the city’s relationship with Flanders "because of the harm his comments have done."
Some observers have rallied to the aid of Flanders, who is a former state Supreme Court justice with extensive experience in bankruptcy law.
Sources indicate that Flanders actually placed the small Rhode Island town of Central Falls under bankruptcy protection last August, so he seems to have a bit of experience in municipal bankruptcy filings.
The mayor’s sensitivity to the former judge’s remarks reflects the dire financial situation in Rhode Island’s largest city. Sources say that the cash-strapped city is currently unable to make pension payments, and the situation seems to be growing worse.
Flanders reportedly believes that the mayor will not be able to reach a compromise with the city’s retired workforce, and that in the absence of a mutually beneficial agreement, the city will have no choice but to file bankruptcy.
Flanders also observed that bankruptcy was a "tremendous tool" for Central Falls, although the town is much smaller than Providence (it has roughly 18,000 residents) and thus its bankruptcy filing was probably much less complex than a potential filing by Providence.
The mayor, however, remains firmly opposed to filing for bankruptcy. In a recent statement, Mayor Taveras said the city is "taking every measure to resolve Providence’s fiscal crisis" and the city "can avoid bankruptcy and will only consider such action as an absolute last resort."
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