Alabama County Prepares for Bankruptcy
Alabama’s largest county is making preparations for bankruptcy. Jefferson County, stung by rising debt service from $3 billion in bonds has asked their lawyers to begin the process if negotiations with creditors do not succeed. Should the county take this route it would be the biggest municipal bankruptcy since Orange County, California in 1994.
The problems began when the county issued the debt to pay for mandated sewer system upgrades, much of which was issued in the form of auction rate securities.
