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Crime has been bad on the south side of Stockton. Katherine Anderson, a lifelong resident of the Northern California city, says she's almost gotten used to hearing shots fired in her neighborhood.

Stockton has long had a problem with drugs. But there's been more crime because Stockton is broke.

Until Detroit's recent filing, Stockton's bankruptcy was the largest in U.S. history. Given widespread police layoffs and retirements, the city's gang intervention and narcotics teams have both closed shop. The result was a murder rate that last year broke all local records.

Anderson called the police recently after a boy was shot riding his bike down the alley that runs alongside her home. It took them four hours to show up.

"He was dead by the time they got here," she says. "There's more crime around here — a lot."

Stockton has sought to fight back. Working closely with the state highway patrol and county sheriff, Stockton has fashioned a "Marshall Plan" for crime. Thanks to stepped-up policing, the murder rate came down 63 percent in the first half of the year.

No one is declaring victory. Stockton is the second-most dangerous city in California, according to FBI statistics.

"There are still an unacceptable number of hours in a day when police will only respond to crimes in progress," says Bob Deis, the city manager.

But problems with crime and city finances aren't as bad as they were. Stockton intends to present a federal judge with its plan to get out of bankruptcy as early as this month.

There's no guarantee the city will meet with success. It continues to face legal challenges and one incredibly steep political hurdle: Convincing residents who have not been getting much by way of government services that they should start paying higher taxes.

Seeking More Taxes

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