At least three of the five Jefferson County, Ala., commissioners have rejected a counteroffer proposed by creditors in negotiations attempting to avert the nation’s largest municipal bankruptcy, according to the Birmingham News on Friday.

Creditors of the county’s $3.2 billion of troubled sewer debt met in Montgomery, Alabama’s capital, on Wednesday reportedly with a counteroffer to a restructuring plan forwarded by Gov. Bob Riley on Aug. 29. That counteroffer sought revenues in addition to annual increases in sewer rates to restructure the county’s sewer debt, which mostly is in auction- and variable-rate securities.

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