BRADENTON, Fla. - The federal judge in Alabama who is considering whether to appoint a receiver for Jefferson County's sewer system will not hold a full hearing as had been expected on Wednesday.

Instead, a status hearing will be held in court in Birmingham, which is the county seat.

In responding to the county's request to postpone the hearing, Judge R. David Proctor said in a ruling that he would not take testimony Wednesday and that the continuance was "designed to afford the parties a full opportunity to resolve this matter before further court action."

Proctor said he would set another hearing on Wednesday.

The county's main bond insurers, Syncora Guarantee Inc. and Financial Guaranty Insurance Co., and trustee Bank of New York Mellon, are seeking a receiver to take charge of the sewer system because they claim the county has failed to implement rate increases and make other operational improvements in the system in order to pay debt service on nearly $3 billion of outstanding variable- and auction-rate sewer warrants.

In addition to a federal suit filed last September, the trio filed an emergency motion asking for the receiver to be appointed quickly, which is what Wednesday's hearing was supposed to consider.

In objecting to the county's request for a delay, Syncora and FGIC said in a court filing that their regulator, the New York State Insurance Department, supported their request for the appointment of a receiver.

"The New York State Insurance Department has not made any public statements on the issue of a receiver," spokesman David Neustadt said in an e-mail on Friday.

Late last year at the request of Alabama Gov. Bob Riley, New York insurance superintendent Eric Dinallo joined negotiations with Jefferson County's creditors, most of which are regulated by Dinallo's office.

Dinallo secured more than $1 billion in concessions from bond insurers and banks, but obtaining those concessions is contingent upon refinancing the troubled variable- and auction-rate debt.

"There does not appear to have been any measurable progress toward a refinancing arrangement since this offer," Neustadt said. "Meanwhile, the sewer system is not paying its bond obligations. If there is no agreement soon, it will be up to a court to decide."

Last Thursday, the insurers and trustee filed a supplement to their original complaint detailing numerous events of defaults that have occurred since last September.

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