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ALSO, the 2010 Fiscal Stability Act describes what can trigger state oversight and intervention, and the levels of intervention possible:

Triggers (6)

Any two can warrant State intervention:

• A municipality projects a deficit in the municipal budget in the current fiscal year and again

in the upcoming fiscal year.

• A municipality has not filed its audits with the Auditor General by the deadlines required by

law for two (2) successive fiscal years (not including extensions authorized by the Auditor

General).

• A municipality has been downgraded by one of the national statistical rating organizations.

• A municipality is otherwise unable to obtain access to credit markets on reasonable terms.

• A municipality that does not promptly respond to requests made by the Director of Revenue

or the Auditor General, or the chairpersons of the House or Senate Finance Committees for

financial information.

Authority (4)

• Allows the Director of Revenue, in consultation with the Auditor

General, to appoint a receiver in the event of a fiscal emergency,

in circumstances that do now allow for appointment of a fiscal

overseer or a Budget Review Commission.

• Prohibits municipalities from filing for judicial receivership and

clarifies that the Superior Court has no jurisdiction to hear such

matters.

• A fiscal overseer, Budget Review Commission or receiver is not

allowed to reject or alter any existing bargaining agreement, unless

through collective bargaining, during the term of such collective

bargaining agreement.

• Provides a mechanism for the Director of Revenue to pay interest or

principal on bonds, notes or certificates of indebtedness when it is

unlikely that a city, town or regional school district will be able to pay

this debt. Allows the State to charge these costs against state aid

(excluding school operational aid) due to the city, town or regional

school district

http://www.ncsl.org/Portals/1/Documents/fiscal/Fiscal_meetings/Daniel_Da_Ponte_Presentation.pdf