Claremont is a city located in Los Angeles county with a population of 37,242 people. Claremont is a upper middle class community that was rated the fifth best place to live by CNN. It is also the home to seven institutions of higher learning giving the city the nick name of college town. Needless to say it is a financially prosperous community, but even in such a community there are companies that feel the pinch of a bad economy.

Why Tri City Mental Health Center Filed for Chapter 9 Bankruptcy

One such company is the Tri City mental Health Center. The Tri City Mental Health Center provides mental health services in Claremont. In February 2004 Tri City Health Care had to file for chapter 9 bankruptcy which is the company reorganization made available to municipalities. The company had to file Claremont bankruptcy for many reasons but the two major ones were expansion and owing large amounts to its creditors.

Expansion was one of the causes because Tri City Health Center expanded to quickly and was unable to keep u with its expansion. It subsequently had to sell most of its facilities and downsize its employees and services. The other cause is the $ 20 million dollars in debt with $12 million of it to a creditor called DMH. DMH claims that the debt owed comes from Tri City Health Care over claiming Medi-Cal services. Tri City Health Center is still operational with many of its services being cut. So even in such a prosperous community and a city contracted company there are such thing as a guarantee in a depressed economy.