Law and legal issues

Jefferson County, Ala.'s decision to skip general obligation warrant payments is yet another example of a troubling trend in municipal finance — the unwillingness to pay debts even when funds are available, observers said.

Jefferson County, Ala., said Wednesday that it will no longer make payments on its general obligation warrants.

CHICAGO — Rating pressures on five Wisconsin school districts involved in a now-worthless $200 million investment product eased on Monday when Moody's Investors Service labeled as a credit positive their partial settlement of a lawsuit against the firms that advised and arranged the deal.

DALLAS — The Austin Community College District plans to price $44.4 million of lease-revenue bonds to build its first campus in suburban Hays County after a Texas Supreme Court victory cleared a path to the market.

CHICAGO — Bids to buy the assets of an upscale continuing-care retirement community in downtown Chicago are due by April 10, with holders of its $229 million of debt hoping for a competitive auction that results in a better recovery rate than the pennies on the dollar offered by an initial bidder.

Some lawmakers want to fine-tune Pennsylvania's program for distressed communities, commonly known as Act 47, after it took a serious blow last fall from a state Supreme Court ruling about public employee arbitration.

CHICAGO — An investor with a stake in $39 million of defaulted bonds issued for a failed artificial sweetener plant in Missouri has filed a lawsuit accusing underwriter Morgan Keegan & Co. and counsel Armstrong Teasdale LLP of providing false and misleading information in the offering statement.

SAN FRANCISCO — Stockton, Calif., said it will negotiate with 18 creditors that have interests above $5 million during mediation meant to help the city restructure its debts to avoid bankruptcy.

BRADENTON, Fla. — Miami officials have been told that civil charges may be brought against the city for failing to disclose serious budget problems in recent bond offerings.

Four companies remain in the running to purchase the incinerator in Harrisburg, Pa., that is the focal point of the city's debt crisis.

The Port Authority of New York and New Jersey is aggressively going after uncollected toll revenue, filing 14 civil suits on Tuesday against what it calls the most egregious toll violators.

Eight creditors holding various claims related to Jefferson County, Ala.’s defaulted sewer debt filed notices late Monday saying that they want to appeal the county’s eligibility to file a Chapter 9 bankruptcy petition.

Moody's Investors Service hit Detroit with a two-notch downgrade Tuesday afternoon, while hours earlier an Ingham County circuit court judge issued a decision that could delay negotiations between Michigan and its biggest city over a proposed consent agreement.

The state-appointed receiver overseeing Harrisburg, Pa.' finances said he will announce on Tuesday his short list of qualified bidders to operate the city' incinerator, water and sewer system, and parking system.

The New York Mets'$162 million settlement Monday in the Bernard Madoff fraud case looms as a victory for a financially beleaguered baseball franchise that has experienced few of them in recent years.

Holders of $229 million of debt issued for a now-bankrupt upscale continuing care retirement community in downtown Chicago would recoup just pennies on the dollar under an initial bid for the facility.

A court ruling that relieves Boston of its financial obligation to a police education incentive program is a credit positive, Moody’s Investors Service said.

Michigan Gov. Rick Snyder indicated that the state would not step in to help Detroit cover its looming debt payments even if the city does not have enough money to meet those obligations.

Stockton, Calif.'s bond defaults have already started a legal tug-of-war with insurers.

Bond-insurer Assured Guaranty Corp. has sued JPMorgan over mortgage securities that Assured says JPMorgan misrepresented.