Bond dealer William Blount of Montgomery resigned last week as financial adviser of the Birmingham Waterworks and Sewer Board, according to the Birmingham News.
Blount, Birmingham Mayor Larry Langford, and lobbyist Albert LaPierre in December were named in a 101-count federal indictment on charges that included conspiracy, bribery, fraud, money laundering, and filing false tax returns in connection with a long-running bribery scheme related to bond and other financial transactions in Jefferson County. Their trial is May 4.
Birmingham is the seat of Jefferson County.
The Securities and Exchange Commission also has filed a civil case alleging securities fraud charges against Langford, LaPierre, and Blount and his firm Blount Parrish & Co. involving Jefferson County’s security-based swaps. Attorneys for the trio are expected to argue during a hearing Jan. 30 for dismissal of the case on the grounds that the SEC has no jurisdiction over security-based swap agreements.
The Waterworks and Sewer Board, which plans to sell up to $150 million of bonds when market conditions improve, is conducting a search for a new financial adviser, the Birmingham News said.
The board last sold $10 million of water revenue bonds in mid-November with Blount Parrish as financial adviser. The 20-year bonds yielded 4.5% in 2014, 5.2% in 2020, and 5.75% in 2029, according to data on Thomson’s Municipal Monitor.
The bonds were rated A2 by Moody’s Investors Service, which also placed a positive outlook on the credit, and AA-minus by Standard & Poor’s.
Standard & Poor’s rating also represented an upgrade on $300 million of outstanding senior-lien debt to AA-minus from A-plus. The agency also upgraded its rating on
$325 million of outstanding subordinate-lien debt to A-plus from A.
“The upgrade reflects management’s willingness to increase rates to maintain sound operations, sound overall debt service coverage, adequate funding of capital, and good reserve levels within the adverse rate-raising environment in which it operates,” analyst Edward McGlade said in November.
Moody’s expressed similar sentiments when it placed a positive outlook on the board’s A2 senior debt rating and the A3 rating on the subordinate outstanding debt.
