CHICAGO — The St. Paul Port Authority will start anew in its efforts to resolve its faltering 876 Bond Fund in a way that benefits all bondholders. This follows a court decision earlier this month that formally killed its plan to liquidate the fund and distribute proceeds to investors holding the remaining $51 million of debt.
The fund's reserves were drained in 2004 and principal and interest payments have fallen short since then. The authority devised the liquidation plan in 2006 to provide partial benefits for all bondholders and won court approval in 2007 to proceed. The bonds mature in 2022 and the authority believes investors with $35 million of later maturing bonds will never receive any principal if no action is taken.