I'd agree with you - that the 90% seems overblown - but at the same time, like you said, there's a lot of work that needs to be done and a lack of capacity/desire to do it.
Catastrophes don't happen until they do - which is to say I'm not sure that the history of 1970-2009 are the best guide either though given the ability of states to bail out municipalities now. Some of the same institutions that bet heavily against the mortgage markets are now moving to municipalities. There is no reason that a crisis of confidence can't happen amongst municipalities such that they are unable to get their bonds refinanced with no one to back them.
Now you just need to look at the finances of places like California and Illinois to get a sense of the magnitude of the problem - it's not just the municipalities, it's entire states.
Historical facts: http://www.publicbonds.org/public_fin/default.htm
A muni meltdown?
Broke states rattling markethttp://www.nypost.com/p/news/opinion/opedcolumnists/muni_meltdown_10IepFWdpphKZrTnoxftBK
"For decades, many of our biggest cities and such states as New York, New Jersey and California have grown mindlessly -- running up ever more debt and routinely hiking taxes on business and entrepreneurs. The market's now saying that the game will have to end."
Will 90% of the municipalities go bankrupt? No. Will a lot? I think the answer is a definite yes unless immediate steps are taken - but look at how willing states and municipalities are willing to lead the way. The only state I can think of that is making a dent might be New Jersey but it's still unclear that they can escape the vortex given their still high debt and deficits. Some states and municipalities believe they will be able to solve the problem with higher taxes and worse there have been many on this site who have even advocated for greater spending supposedly to "kick start the economy" right into the coffers of unions and their pensioners.