New hang ups in the Jefferson County bankruptcy exit plan - WSET.com - ABC13

New hang ups in the Jefferson County bankruptcy exit plan

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JEFFERSON COUNTY - AL -

Jefferson County's plan to exit bankruptcy is on the line. A change in revenues and interest rates - means hundreds of millions of dollars difference in getting the county out of bankruptcy. The county is now looking to it's creditors to fill the hole. 

Today's commission meeting started the clock ticking on the plan to exit bankruptcy. That plan has been in the works since July, but since then, costs are up and interest rates are higher than projected. Those rates went up in part due to the federal budget and multiple municipal bankruptcies. The bottom line is - the plan is now short $350 million.  That means, more money toward interest payments and less to the principle.  Commissioners say they will not raise sewer rates for people in Jefferson County. Each of them said the burden to fill this gap is on the creditors. The Commission voted unanimously to give the creditors until November 4th to come up with the difference. If they don't - then the county will withdraw their bankruptcy exit plan. That could leave the county in bankruptcy another 18 months.

"We've asked our sewer rate payers to do as much as we feel we can ask them," Commission President, David Carrington said. "Our rates will be at the edge of reasonableness. If we will proceed with a plan, they will have to provide $350 million in concessions."

Commissioners Joe Knight and David Carrington will go to New York this week to meet with creditors. They told us they will stay as long as it takes to find a resolution.

 


 

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