Thanks goes to Pete for scouting out the regional papers. This was coming and I think stems back to the failure of the ARS market but it could still cause a double take by a few investors if it happens and ends up on the front section of the WSJ. I don't think this will be the last muni default before this is all over with.
http://www.al.com/news/birminghamnews/index.ssf?/base/news/1219738563247390.xml&coll=2
Jefferson County expects to default on its $3.2 billion sewer debt Friday and likely will not enter into another payment extension with its Wall Street creditors, Commission President Bettye Fine Collins said Monday.
At that point, the commissioners likely will authorize attorneys to begin bankruptcy proceedings, she said.
Collins said she had hoped a deal could be worked out without the county filing the largest municipal bankruptcy in the nation's history, but she now thinks that such a deal is unlikely.
Who is insuring this:
When the county defaults, bond insurers Financial Guaranty Insurance Corp. and Syncora Guarantee Inc. are required to cover the payments under an agreement with the county. Both insurers would expect the county to reimburse those payouts in full, as outlined in that agreement.
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