Jefferson Nixes Credit Line

Jefferson County commissioners last week decided they will no longer seek a $25 million line of credit from Regions Bank, according to local publications.

The decision not to seek the credit line came following the recent announcement by the Securities and Exchange Commission that it fined JPMorgan for securities fraud and other charges related to the county’s sewer debt and swaps.

JPMorgan, the county’s largest creditor, paid Jefferson $50 million and forfeited nearly $650 million in swap termination fees and related charges. The firm also paid another $25 million to the SEC that is expected to be used to reimburse investors and possibly the county.

The county has spent nearly two years negotiating with sewer creditors to restructure $3.2 billion of variable- and auction-rate debt. After the recent SEC announcement, the county filed suit against JPMorgan and former elected officials who were involved in selling the sewer debt and swaps in 2002 and 2003.

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