Jefferson County, Ala., could balance its 2013 fiscal year budget by once again defaulting on its general obligation debt, the Birmingham (Ala.) News reported today. Jefferson County Commission President David Carrington proposed that the county default again on its next general obligation debt payment and use that money instead to pay the county's bankruptcy lawyers. The county has budgeted $15 million for bankruptcy-related legal fees for the next fiscal year, which begins Oct. 1. Next year, the county has $23 million of principal and interest payments due on its general obligation debt. The county has already defaulted on one general obligation payment in April and has voted to miss another in October."I hope we're out of chapter 9 by April," Carrington said. "That would be wonderful, but then we're out of the legal fees."
http://blog.al.com/spotnews/2012/09/jefferson_county_could_default.html
In related news, Bankruptcy Judge Thomas Bennett yesterday turned aside a request by Wall Street creditors to set a deadline for Alabama's Jefferson County to develop a workout plan in America's biggest municipal bankruptcy, Reuters reported yesterday. Arguing that the county, which filed its $4.23 billion case last November, was proceeding too slowly, some creditors in July asked Judge Bennett to set a deadline for hammering out an exit plan. Lawyers for the county, which has exclusive rights to propose an adjustment plan that must win Bennett's approval, said Jefferson County's finances were deeply tangled and required more time to sort out.
http://www.reuters.com/article/2012/09/13/usa-alabama-jeffersoncounty-i…