There were almost 1,000 fewer bankruptcy filings in Eastern Washington last year than in the previous year, the second consecutive year of declining activity, year-end data show.
Consumers and businesses filed 6,214 bankruptcy petitions last year in the U.S. Bankruptcy Court's Eastern District of Washington, which is based in Spokane. That's a 13 percent decrease from 2010, when a total of 7,182 filings occurred.
The Eastern District is composed of 20 Washington counties east of the Cascade Mountains. In Spokane County alone, bankruptcies decreased at a greater rate than in the district as a whole. Consumers and businesses filed 2,143 bankruptcy petitions in the county, down 16 percent from the 2,573 filings in the county last year.
The double-digit decrease in bankruptcy activity districtwide last year follows a 0.7 percent drop in activity in 2010, which was the first time filings volume had declined since 2006.
Kevin O'Rourke, an attorney with Southwell & O'Rourke PS, of Spokane, says there still are a number of businesses and households out there who are trying to work through their debt issues, many of which involve distressed real estate holdings. He says it's difficult to project whether bankruptcy filings will continue on a downward trend in 2012.
"There are just too many factors in play with what's going to transpire regionally and nationally to know what's going to happen," O'Rourke says.
However, he adds, "I'm hopeful that a reduction in filings is an indication that there's an increase in economic opportunities."
In the U.S. Bankruptcy Court District of Idaho's Coeur d'Alene court, the number of filings declined as well, though the decrease wasn't as pronounced as in Eastern Washington. Full-year 2011 figures aren't available yet, but for the 12-month period ended Nov. 30, 1,334 bankruptcy filings occurred in the Coeur d'Alene court, down 2 percent from the year-earlier period, when 1,359 filings occurred.
The decrease follows an 18 percent rise in filings in Coeur d'Alene during 2010.
Bruce Anderson, a partner in the Coeur d'Alene office of Sandpoint-based law firm Elsaesser, Jarzabek, Anderson, Elliot & MacDonald Chtd., typically represents debtors in bankruptcy filings. He says much of the bankruptcy activity in North Idaho continues to be tied either directly or indirectly to problems with real estate holdings. He says many lenders and property owners still are working through many of those issues. Consequently, he is expecting bankruptcy activity to remain flat this year.
"I talk to a lot of people in real estate, and the opinions are all over the map," Anderson says. "But nobody is committing to saying it's going to get better in the short term."