REUTERS: Bankrupt Alabama County OK's Debt Deal With European BankSubmitted by emalvini on Thu, 02/14/2013 - 21:57
REUTERS: Bankrupt Alabama County OK's Debt Deal With European Bank
BIRMINGHAM, Ala. | Thu Feb 14, 2013 | 6:30pm EST
Feb 14 (Reuters) - Officials in Alabama's bankrupt Jefferson County approved a deal on Thursday with European Depfa Bank Plc to cut interest charges on about $162 million of the county's school debt.
Although the "plan support agreement" saves only about $1 million a year for the county, which in 2011 filed a $4.23 billion municipal bankruptcy, the resolution passed by the Jefferson County Commission said the deal would likely help the county hammer out a broader adjustment plan with its Wall Street creditors.
Home to Birmingham, Alabama's biggest city, Jefferson County was primarily driven into what is the biggest bankruptcy ever by a U.S. local government by massive sewer-system debt now estimated at $3.2 billion.