BRADENTON, Fla. - The Jefferson County, Ala., Commission yesterday voted 3 to 2 against filing for bankruptcy.
The vote came during a regular commission meeting in response to a resolution sponsored last week by commissioners Jim Carns and Bobby Humphreys. The two Republicans make up two of the three members on the Environmental Services Committee, which oversees the county's financially troubled sewer system.
Commission President Bettye Fine Collins, a Republican, and commissioners George Bowman and Shelia Smoot, both Democrats, voted against filing what would be the largest municipal bankruptcy in U.S. history
The sewer system has $3.2 billion of outstanding debt, most of which is in variable- and auction-rate mode. The county has been negotiating with creditors for eight months trying to restructure the debt.
Commissioners have begun discussing where they might obtain additional revenues to supplement a restructuring plan negotiated last week by Alabama Gov. Bob Riley and the New York Insurance Department. That plan calls for creditors to provide $1 billion in concessions in return for placing the sewer system under a new regulatory board and the county coming up with additional revenue to complete refinancing of the sewer debt.
On Monday, the Birmingham News reported that Riley said the Treasury has declined his request for a backstop of the restructuring plan. Riley had asked Neel Kashkari, who oversees the Treasury's new Troubled Asset Relief Program, for a backstop of Jefferson County's sewer restructuring plan. Riley reportedly said Kashkari would not provide a backstop to any city or county.
