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Shirley Franklin's sweet victory may have a sour aftertaste -- Atlanta is almost bankrupt.


Here's a quiz. From the clues below, name a great American city in trouble.

Even though it's known as a regional hub of commerce and culture, it's actually a poor city with a wide gap between the haves and have-nots.

The delivery of its city services is plagued by poor management, the causes of which are years of cronyism and the departure of qualified leaders.

It uses money that is supposed to be dedicated to certain capital projects for random expenses that have popped up over the years because of mismanagement and overspending in other areas of the city's budget.

It is facing a multi-million dollar budget shortfall.

It is plagued by a federal investigation that reaches the highest levels of city government.

It has used up much of its cash reserves, which causes some people to think that it teeters on the brink of insolvency.

It doesn't collect its taxes and fees.

Its political leaders have lacked the political will to make difficult choices about its budget -- from raising taxes to cutting jobs and city services -- in the face of dire economic conditions not of its own making.

It has been taken over by the state, because it could not solve its own financial problems.

Atlanta? Nah, the last question points to another city: Miami during the late 1990s.

But the parallels are striking and disturbing between the Miami that went bust and the Atlanta on the edge of financial collapse.

Here's why: The same economic conditions affecting the city of Miami before it went bankrupt and had its finances taken over by Florida's state government exist right now in Atlanta. The depletion of the reserves, the inability to collect taxes and fees and financial mismanagement -- they're all there.

That is not to say the sky is falling, but it is awful heavy and some of the strings are breaking.

After the sunny glow of winning a relatively easy race against a seemingly overconfident opponent wears off, incoming mayor Shirley Franklin must move quickly to map out a new financial path for the city. (That is, of course, if a Tuesday recount doesn't put her plans on hold.) If she can't, she risks bankruptcy or other financial consequences -- such as the lowering of the city's bond rating. And the city needs to keep its stable bond status, because it will require tons of state and federal cash to finance a slew of infrastructure projects, such as fixing its failing sewer system.

On the campaign trail, Franklin has seemed convinced that there's enough waste in city government -- the very processes by which work is organized and carried out -- to cut so that raising taxes or firing employees won't be necessary. According to experts, she's wrong, and one of the main reasons Miami got into its calamitous situation was because its leaders lacked the political will to make difficult decisions.

There are significant differences between the financial situations in Atlanta and Miami, differences that clearly suggest that Atlanta isn't yet in the same already-capsized boat Miami found itself in during 1996. Miami had very few revenue options; Atlanta does. Miami couldn't levy a sales tax; Atlanta has a sales tax, though it relies too heavily on it. Also, people were leaving Miami and its property tax rate was near the maximum allowed by the state, so there was nowhere for it to go when it needed more money; Atlanta's population and tax roll are growing.

What's more, Miami's bond rating was reduced to junk status, there were no cash reserves, and the city faced an unfillable $68 million financial hole.

Atlanta's bond rate is at worst only threatened -- for now. The pit here is $45 million. Reserves have evaporated, but with effort they can be replenished.

That said, the similarities between Miami and Atlanta are frightening, and they portend dismal things for the city's financial future.

"If you listen to the radio and read the newspaper, we're going to hell," says David Corbin, the city's chief financial officer. Then he laughs heartily.

Others aren't laughing so much.

"It's unusual," understates former mayor Sam Massell about the budget shortfall.

City Council President and, as of Friday afternoon, mayoral candidate Robb Pitts, goes farther. "I think we are in serious trouble," he says. "There will be a balanced budget, but the question is how it will be balanced."

Corbin discounts the doomsayers.

"We are not insolvent," he concludes. "We are not going bankrupt."

To be fair, some of the problems with the budget are out of the city's control. Because of the economic slowdown and the fallout from the Sept. 11 attacks, sales tax revenues are down, exactly how far down Corbin isn't exactly sure yet, but revenues are off by about 7 percent across the state.

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