BRADENTON, Fla. - Jefferson County, Ala., commissioners yesterday approved new forbearance agreements on nearly $120 million of non-sewer general obligation warrants.
In addition, commissioners approved paying $5 million to creditors as a partial principal payment on the debt that was due.
The latest forbearance agreement delays until March 12 portions of accelerated debt payments that are due to JPMorgan Chase and Bayerische Landesbank Gironzentrale, the banks holding the Series 2001B variable-rate demand obligations warrants.
The warrants, outstanding in the amount of $118.7 million, were purchased by the banks in March as part of the county's standby purchase agreements. Those agreements obligated the county to redeem the bank warrants in six semiannual principal installments.
The first installment of $9.89 million to each bank was due Sept. 15. Jefferson County made a $10 million payment toward the first installment in return for a forbearance agreement that expires today.
The variable-rate GO warrants, which are not related to the county's troubled sewer debt, were downgraded in September to B3 by Moody's Investors Service and D by Standard & Poor's.
Jefferson County's credit ratings plummeted below investment grade last year because of bond insurer downgrades and the county's inability to restructure some $3.2 billion of outstanding sewer debt, most of which is in variable- and auction-rate mode.
In addition to debt-related problems, Jefferson's budget took a hit on Monday when a circuit judge struck down the county's occupational tax, which brings in more than $70 million a year.
The judge ordered the county to place tax collections in an interest-bearing account starting Monday, but did not order refunds. The county has collected the tax for nearly nine years.
County commissioners on Tuesday voted to appeal the judge's ruling.