On August 25, 2006, the district filed for Chapter 9 bankruptcy protection in federal court. While the district had enough money to cover day-to-day needs, it did not have enough money to cover its legal fees and consultant fees. This action stayed the legal actions against the district related to money owed. Contractor lawsuits and other actions seeking monetary damages or claims against the district will be held in abeyance while the district addresses its financial situation. Subsequently, the LOCSD Bankruptcy Plan was approved in 2013. All claimants party to the bankruptcy were paid 45 cents on the dollar. The LOCSD, as the debtor of the Bankruptcy, was required to raise 2.5 million dollars to pay claimants by selling the LOCSD solid water franchise to the County of SLO.