A WA Mountain Town Faces A Money Crisis Like No Other

The city of Cle Elum, and by extension its residents, are in serious trouble. It all started about 10 years ago when Cle Elum entered an agreement with City Heights Holdings. When the deal collapsed the city of Cle Elum tried to reach an accommodation with CHH but ultimately, they could not come to any kind of agreement. 

According to msn.com,
‘Cle Elum, a picturesque community in central Washington state, has been embroiled in a long-term land development dispute. After a lengthy legal proceeding, the city was directed by the courts to pay City Heights Holdings $25.9 million in damages.’ 

At this point, the city decided they had no other choice but to file for bankruptcy. 

But where does this leave the rest of the community? 

The city of Cle Elum has approximately 2200 residents along with the businesses that cater to those residents and to people passing by on the I-90 corridor.  

Cle Elum filing for bankruptcy keeps the lights on along with other utilities and they are able to pay their employees but for how long?  

Currently, the city has an annual budget of approximately $5 million. That budget doesn't leave a lot of room to service a $25.9 million debt. 

During the mediation process, the city made more than three offers over the course of three months that they thought were generous, but CHH declined those offers so now Cle Elum is on the hook for the full $25.9 million. The Cle Elum City Council voted unanimously in favor of the filing for bankruptcy. 

Now that the city has filed for chapter 9 bankruptcy which means, at least for now, the city will have money to operate, what will happen next? 

So, now everything goes to bankruptcy court to take over and offer up what the city hopes is a more “Sustainable solution” that will allow the city to pay the judjment and still maintain city services. 

Residents worried after city files for bankruptcy
City Heights Arbitration Award Information - City of Cle Elum