{{show_title_date || "Woonsocket, RI suffers from major deficit, pension issues, 7/27/13, 8:51 AM ET"}}

How one Rhode Island city averted bankruptcy

Updated

Detroit’s bankruptcy filing is shedding light on other cities in financial crisis across the nation. Mayor Leo Fontaine of Woonsocket, R.I., explains his city’s budget deficit and its current economic condition.

“We have a financial crisis that was brought on primarily through a number of cuts from state funding over the last few years compounded with pension costs and health insurance costs,” he said.

Bankruptcy was on the table for Woonsocket last year, but the city has actually moved further away from filing. Fontaine attributes this to a “pretty aggressive but reasonable five-year plan that addresses all of our concerns.”

When msnbc’s Alex Witt asked the mayor about the role of state and federal governments, he pointed to the necessity of taking an overall look at bankruptcies in cities and towns across America.

In regard to pensions and unions, Fontaine added, “I think that there is a change that needs to take place.”

How one Rhode Island city averted bankruptcy

Updated