BRADENTON, Fla. - Jefferson County, Ala., Commission President David Carrington is working on a "tell-all" book about the nation's second-largest Chapter 9 bankruptcy.
Carrington announced
The book will disclose details such as the circumstances around a private meeting to extract additional concessions before the county sold $1.8 billion of new sewer refunding warrants to write down $3.14 billion in old sewer debt, Carrington told The Bond Buyer in late November, just days before closing on the deal.
The November warrant pricing paved the way for the county's formal bankruptcy exit Dec. 3, though it still faces an appeal.
The stage for the secret meeting was set in October when county commissioners threatened to back out of the refunding saying they needed about $300 million in additional concessions because of rising interest rates and additional capital needs.
Carrington met with a representative of the county's largest creditor, JPMorgan, at his condo in Destin, Fla.
The bank had already agreed to take the biggest loss of all creditors receiving about 30 cents on the dollar for the $1.22 billion in sewer debt it held.
As a result of the negotiations in Destin, JPMorgan additionally agreed to provide a 40-year letter of credit worth about $140 million so the county could avoid borrowing to fund the debt service reserve.
"When I write my book, and I am writing it, that meeting was one of the most critical of the process," Carrington said. "If JPMorgan had said you are on your own we would have shifted to a cram-down strategy."
He went on to say at that point the "county had no more to give," meaning that the commission would not raise sewer rates a third time to support the new debt.
The book is likely to note that it was projected that the case could take up to four years to settle due to the county's complex debt portfolio. Alabama's most populous county, however, filed for bankruptcy on Nov. 11, 2011 and exited in about two years. It cost about $25 million for attorneys and other expenses.
When asked about the appeal, Carrington said that he's confident in the legal basis supporting the county's bankruptcy plan, which is expected to make the success of such a challenge unlikely.
Carrington, a Republican, is president of RacingUSA.com, an independently owned NASCAR store. He was elected to the Jefferson County Commission in 2010 and is seeking a second term.
Most of his daily tweets are verses from the Bible. "It keeps me grounded," he said.
Carrington said Jan. 17 that he is in the process of writing the book, and it is expected to be published on Dec. 4, “the first year anniversary of our exit from bankruptcy.”
