Alabama County Rejects Debt Settlement, Stalls Bankruptcy


Jefferson County, the largest county in Alabama, voted unanimously to reject a settlement with Wall Street creditors that would wipe out $3.1 billion in debts the county owes. This has effectively given more time for the commission president and finance chair to personally negotiate a deal. The deadline to do so has been fixed for September 16. The $3.1 billion debt comprises of money owing for sewerage system services that has been outstanding for several years. The debt has accumulated over the years due to a combination of factors such as old sewerage pipes, the economic recession, court rulings and corruption.

The county has been stalling filing for bankruptcy for the last 3 years. The case has drawn the attention of a host of parties including the governor of Alabama, state officials and the court-appointed receiver. David Perry, the governor’s chief of staff said that filing Chapter 9 bankruptcy is still an option but added that, “a general framework for a deal is in place.”

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