Thirsty California ski town files for bankruptcy

MAMMOTH LAKES—Mammoth Lakes, home to California’s biggest ski area, has filed for bankruptcy.

The town announced the decision on its Website today.

It is sort of a High Sierra China Town. Like many things in California water is one bottom line.

A lawsuit won by a developer demanding $43 million for breach of contract for a failed project also is putting the squeeze on the community.

The debt may be settled in court, but if the Mammoth Lakes can’t retain its water supply it will be a ghost town.

The Los Angeles Department of Water and Power says it owns the city’s main water supply, Mammoth Creek, and has since 1905.

The town says it has permits from the state to take the water, and LA never complained until now.

Growth, the other bottom line in California, means Mammoth Lakes is taking more water with the growth of real estate that accompanied the dramatic increase in the popular of skiing.

“Every drop counts, and under the city charter we are mandated to protect every drop,” LA Deputy City Attorney Bill Carter told the Los Angeles Times.

The Mammoth Mountain ski area, the town’s economic engine, is independently owned.

Water rates would have to be raised dramatically to pay what LA wants for the water. And this in a town with 12.1 percent unemployment.

Many services have already been cut and employees laid off.

The town said it will continue to operate emergency services such as police and fire, as well as essential ones like roads and airport maintenance. The town office will stay open.