Jefferson County to Appeal Bar on Bondholder Payment Cut
Alabama’s bankrupt Jefferson County said it will appeal a judge’s refusal to let the county reduce payments to bondholders.
U.S. Bankruptcy Judge Thomas B. Bennett in Birmingham, Alabama, ruled in June that the county can’t cut the payments so it can spend more on its aging sewage system or pay legal fees. Lawyers for the county said in a filing yesterday they will appeal the ruling.
Bondholders are owed more than $3 billion, debt that is backed by the payments made by business and residents in Alabama’s biggest county.
The county filed the biggest municipal bankruptcy in the U.S. after elected officials and creditors failed to implement a proposal to cut the sewer debt by about $1 billion.
The case is In re Jefferson County, 11-05736, U.S. Bankruptcy Court, Northern District of Alabama (Birmingham).
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