Municipality in Alabama Files for Bankruptcy
Posted on Aug 1, 2011 1:00pm PDT
With so many businesses and individuals filing for bankruptcy, it should almost come as no surprise that entire municipalities are now seeking bankruptcy protection.
This is the case for one county, a densely populated area in the state of Alabama. Due to a variety of events, such as the civil rights movement, a tornado last year and a local debt problem, town officials are scrambling for a solution.
The municipality's debt has affected nearly everyone in the county and is said to be caused by overspending. At this time, the county is attempting to negotiate with lenders in order to pay its employees who have been without compensation for some time.
Many blame a now defunct sewer project that was never completed, but ran up millions of dollars in debt in the interim. Add this to a serious loss in tax revenue and the county is now struggling to hold itself together financially. Due to the dwindling finances, many other areas of the region have been neglected in an attempt to solve the financial crisis.
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