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ouur I uc$orl lOl'CecI
<br /> to file for bankruptcy
<br />Cost?uaE/rom ~ge 2 ,.. in reality that would have ~en im-
<br />w~ hit wjlh a ~3.6 million )ia~ility ~ossJh]e, Mr. Serna said. The me-
<br />~udgmen[ thai exceeded i~ annual dian income in South Tucson is
<br />~dget by almost ~1 million. At the ~J0,188 which is near Ihe povert
<br />lime, 3effer,on Insurance Co ' · · Y
<br />New York underwrote the city's een~ per ~1~ o~ a~esscd valuation
<br />~!~,~ ~lice UabUity ~licy (BI, in pro,cry ~xes, which brings in
<br />April 19, 1982). only $17,~0 a year.
<br />
<br />Claim pushes
<br />town to brink
<br /> ..By CAROL CAIN
<br />
<br /> SOUT]i TUCSON, Ariz.--The
<br />t.wn of South Tucson is turt,ing to
<br />bankruptcy court alter faihng Io
<br />negotiate with an injured Tucson
<br />police officer how it would pay a
<br />$3.6 million damage award.
<br />
<br /> Immediately after the accident,
<br />the city increased its liability cov-
<br />erage with a $900,000 insurance
<br />policy excess of a $100,000 self-in-
<br />sured retention. The city has since
<br />
<br /> The town is in good shape finan-
<br />cially in terms of operation of the
<br />town, but with this outstanding
<br />claim hanging over it, businesses
<br />have been reluctant to move into
<br />
<br /> The town of 6,500 residentz filed
<br />for municipal debt readjustment
<br />Aug. 25 under Chapter 9 of the
<br />Federal Bankruptcy Act. ,.,~
<br /> The U.S. Bankruptcy Court judge
<br />in Tucson set ~ 30*day period for
<br />
<br />Increased its Uability coverage to the community, fearing increased
<br />$10 miUion. * tax assessments, Mr. Serna said.
<br />
<br />creditors to object to the filing. At
<br />
<br /> ,..~........~ Mead Reinsurance Corp. of South Tucson wants to move on the end of that period, the judge is
<br />'~ * ' · Freeport, Ill., writes the first to soliciting new business a - ' expected to designate a time [came
<br />i '~ $~00.000 of coverage above a '- -~ ........ n? p,ans for the city to submit a readjust-
<br />. ,u uu r,o a~ter me ~arcia claim is ment plan, said Enrique Serna,
<br /> $100,000 selg-insured retention and settled in bankruptcy court, Mr. South Tucson's city manager.
<br /> Planet Insurance Co. of Philadel- Sernasaid. - · "We want to come to an agree-
<br /> ph!.a writes a Sg million excess of $I
<br /> million policy, ment with our creditors for a pay-
<br /> I -- -------------' ~' · meat schedule...our overall inter-
<br /> The city failed in its appeals of j · M ["':-":." est is to finalize with Mr. Garcia~
<br />:., the $3.6 million award, and an ArJ- I ~' B i....'"""il our largest creditor,* Mr. Serna
<br />' ::."- zena Superior Court ultimately or- ~,,~1 s~id.
<br /> dared it to pay the paral3zed police I ~BJ[i~ - -[ Roy Garcia, a Tucson pblice
<br /> officer more than $4.5 million in
<br />
<br />.?,~. . ., five equal annual installments, and [ ~--~ -..~_ _ s~t...~, .~.[ car, was accidentally shot by a
<br /> ~x its citizens, If necessary, to raise / ~ ~ dl~q~l J[· [-"-}~'%~ [ South Tucson police officer during
<br /> / · · U WW /~.~;:~[I a mutual aid response to an OcL il,
<br /> Ihe money (BI, May 10, 1982). The / ~! 1978, shootout m South Tucso .
<br /> $4.5 million included interest on -- m ~ · · a -."'f-~,c~ ' n
<br /> the original $3.6 million award. ] ..,,,,. .[~'--~. ,.'{ After a long legal fight, the city
<br /> South Tucson made several I
<br /> · ~ ~ B .' · ' il Continued onpa§e33 ,
<br /> offers to settle with Mr. C~arcia. / can tm ~,,il
<br /> One suchofferinMayl982in. on ,ro l gsbe ySs!EpOuESNTAdR.eo F
<br /> eluded a $2.2 million structured set-
<br />I~' .~''''''' t tlement ~or Mr. Garcia and $1.6
<br /> million t.o~ cover attorney ~ees
<br /> May l?. i~}82). ..
<br /> At one time, South Tucson also ~:' W^SHINGTON A Cleveland manu°.~
<br /> offered him three parcels of city ;+.. ,' ' --
<br /> land valued at $'t50,000 and annual / ~-~1 latest company to sue iL~ primary and exfk'.
<br /> · payments of $50,000 for 30 years ! - · ~ force them tn provide coverage, and a
<br />
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