Ala. County To File Largest municipal Bankruptcy

Leaders vote for it after being unable to resolve $3.14 billion debt caused by sewer system

MONTGOMERY, Ala. — Alabama's most populous county filed the largest municipal bankruptcy in U.S. history Wednesday, years after being plunged more than $4 billion into debt by a corruption-riddled sewer project.

Just two months after it seemed Jefferson County could stave off embarrassment by striking a deal with creditors, talks broke down over about $140 million, said Commissioner Jimmie Stephens, who made the motion to file for the protection. Since 2008, commissioners have tried to avoid the move to settle the debt, which resulted mostly from a mix of outdated sewer pipes, the lagging economy, court rulings and public corruption.

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