Chapter 9 Bankruptcy Possibly in the Cards for Jefferson County, Alabama

Chapter 9 bankruptcy, which is bankruptcy for municipalities such as cities, counties and towns, is a very rare thing, but one Alabama county may be facing a Chapter 9 in the very near future.

Jefferson County, a county in northern Alabama, is Alabama’s most highly populated county with its county seat in the large city of Birmingham. The county’s size offers it no comfort, however; according to Reuters, county commissioner Sandra Little Brown has predicted that the county has an 80 percent chance of filing Chapter 9. A staggering $3.2 billion sewer bond debt is leaving the county with few options, and pending litigation over the high debts has placed the county in a precarious position.

Other commissioners, as well as John Young, the county sewer system’s financial manager, believe that Chapter 9 will not solve the county’s problems. Young has said that he would still have to raise residents’ sewer rates, even if the county files bankruptcy.

Law Firm of Kevin D. Judd – Washington DC bankruptcy attorney