Mayoral candidate Kabat confirms bankruptcy [La Crosse Tribune, Wis.]

Feb. 24--La Crosse mayoral frontrunner Tim Kabat filed for bankruptcy in 2011, but he says it won't affect his ability to lead the city.

The 46-year-old Kabat said a series of surgeries and medical problems for his wife pushed the family's debts past what they could handle.

"I never thought in a million years I would be in that position," said Kabat, who drew more than 40 percent of Tuesday's primary votes despite having 10 opponents on the ballot.

Kabat left as city planning and development administrator in January 2010 to become executive director of the non-profit Downtown Main Street Inc. With only one full-time employee, DMI does not offer health insurance.

He obtained private coverage, while his wife had insurance through her employer, Whitehall School District.

But her severe osteoarthritis made it increasingly difficult to commute two hours a day to Whitehall. So she accepted a part-time English teaching position at Viterbo University, also without benefits.

They didn't realize, they said, her pre-existing condition would relegate her to the state's Health Insurance Risk-Sharing Plan, with higher premiums and deductibles.

It left them vulnerable when Christy Kabat needed three surgeries -- on foot, broken ankle and spine -- within two years.

The household also went from two full-time incomes to his wife working only a fraction of the time, Kabat said.

Their bankruptcy petition, filed in June 2011, listed $288,513.81 in assets and $335,102.68 in debt.

That included more than $47,000 in credit card charges. Much of that was to pay for medical expenses or to cover other household costs while shifting money to medical bills, Kabat said.

But some clearly were for other uses, such as cards for Old Navy, American Eagle, Kohl's and Macy's. Kabat said they leaned more heavily on those cards under the weight of the medical bills.

Two surgeries came after the Kabats filed for bankruptcy, and they continue to struggle with medical debt. They have continued to whittle away at what they owe, especially to local creditors, Kabat said.

"Every month is tough," Kabat said.

"We are still working very hard," Christy Kabat said. "I'm sure things will change."

Kabat's opponent, Doug Farmer, said he does not intend to make the bankruptcy an issue leading up to the April 2 election.

Almost 40 years in banking taught him "people have many different reasons for filing bankruptcy and we should respect that," Farmer said.

Several of Kabat's mayoral opponents privately spoke with him about the matter, but none raised it publicly. All 11 mayoral candidates learned about the bankruptcy in mid-January, when someone mailed them anonymous letters.

The public reaction so far, too, has been more positive than negative, Kabat said. He's heard similar stories from others, how they were only one medical situation away from being in the same financial straits, he said.

"I really have an appreciation for what people struggle with every day," Kabat said.

He knows not everyone will be as understanding, that the issue could turn some voters away. Before Kabat entered the race, he and his wife discussed with their two teen children -- who were aware of the bankruptcy -- what might happen when the matter inevitably surfaced.

Both Kabat and his wife maintain the bankruptcy doesn't mean he can't handle the job as mayor.

Kabat pointed to DMI, which he said has a budget reserve, expanded membership and hasn't tapped its line of credit in several years.

Kabat informed DMI officials before filing for bankruptcy, said Mike Keil, president of DMI's board of directors.

"He was very up front," Keil said, adding the matter has been "no issue whatsoever" with Kabat's service at DMI.

"Sometimes bad things happen to good people," Keil said, "and that's what I think was the case with Tim."

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