Ala. County Pushes Toward Deal Over $3.2B Bond Debt

Law360, New York (August 12, 2011, 7:37 PM EDT) -- Jefferson County, Ala., on Friday rejected a settlement with Wall Street creditors, but set a path toward refinancing $3.2 billion in bond debt, likely averting what would have been the largest municipal bankruptcy on record.

The county commission was expected to vote on a Chapter 9 filing, but instead prolonged negotiations with JPMorgan Chase & Co. and other bondholders that financed an overhaul of the county’s crumbling sewer system a decade ago, a project ultimately mired in corruption and failed derivatives transactions.

“The county and creditors...
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