Jefferson County Financial Struggles Continue
With no relief from the state Legislature, Jefferson County has skipped payment on a $200 million general obligation bond payment for the second consecutive month.
Jefferson County had asked the Legislature to reinstate a jobs tax, under which those who work in the county would pay less than a percent for the privilege. But legislators from commuter counties balked and blocked the proposal, leaving Jefferson with no way to collect the revenue. The tax had been in effect until 2011 and paid for about 25 percent of the county’s budget.
Now the county faces troubles on troubles. A computer server broke in early June, and the county has let go the staff who knew how to repair it and has no money to pay for outside help. “You do away with people and you do away with outside maintenance contracts that take care of that proprietary equipment, and you’re left with the inability to operate government,” Commissioner Jimmie Stephens told The Birmingham News.
It’s not just a problem for Birmingham and Jefferson County, Bloomberg Businessweek reports. Other Alabama counties already are paying a 0.25 percent penalty because of proximity to the bankrupt county, Bloomberg reports. In today’s market, municipal bonds are popular, Bloomberg’s experts say, adding that without that protection, Alabama cities and counties could be in far worse shape because of the unresolved debt problems in the biggest county.