Alabama city files for bankruptcy amid coronavirus woes
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The city of Fairfield, Alabama, has filed for bankruptcy, becoming the latest in the state to do so.
Mayor Eddie Penny said his city, which is home to roughly 11,000 people, had been struggling financially for years, but the coronavirus pandemic has made matters worse, forcing businesses to shutter.
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“Our expenses greatly exceeded our revenues, so we’re just seeking a fresh start,” Penny said, according to AL.com. “It gives an opportunity to reorganize, reassess our finances.”
Fairfield, a suburb of Birmingham, filed for Chapter 9 protection, citing between $1 million and $10 million in liabilities and between 200 and 999 creditors. At least a dozen cities or counties in the state have gone this route in the past 30 years according to AL.com. Jefferson County, where Fairfield is located, filed for bankruptcy in 2011. At the time, it was the largest government bankruptcy ever with $4.23 billion of debt. Now Fairfield owes the county more than $1.7 million.
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Jefferson County Commission President Jimmie Stephens told The Associated Press that officials are exploring various ways the city can reorganize and recover.
“There’s talks of dissolving and going back into Jefferson County. There’s talks of merging with other municipalities. There’s talks of restructuring their debt,” he said.
{{#rendered}} {{/rendered}}The Associated Press contributed to this report.