DALLAS - Jefferson County, Ala., cannot protect its excess sewer revenue from bondholders to whom it owes $3.2 billion, a federal judge ruled Friday in a victory for the bankrupt county's creditors.

In a 43-page memorandum opinion, Bankruptcy Judge Thomas Bennett said the contract between the county and its creditors does not allow Jefferson County to set aside net revenue for legal fees, system repairs, or future expenditures.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.