Fraud, Bribery and Corruption involved in sewer scandal

Jefferson County is a county in Alabama. Its county seat is Birmingham. Home to approximately 700,000 residents, The County's finances have been rocked by a scandal surrounding a sewer rehabilitation project that has resulted in the conviction of nearly two dozen county employees, contractors and advisers and 4 commissioners.

The county is considering filing for bankruptcy and has been working to avoid it over the past three years. The county is liable for $6 billion, by far the largest government bankruptcy in history.

Corruption/ Sewer Scandal
Nearly two dozen Jefferson County employees, contractors and advisers involved in the county's $3.2 billion sewer rehabilitation work have been convicted in federal court, and most were convicted of bribery and conspiracy.

The following former commissioners have been convicted in the scandal:
  • Former County Commission President and Birmingham mayor Larry Langford on 60 counts all stemming from his acceptance of bribes in exchange for him sending lucrative bond business to investment banker Bill Blount
  • Former county commissioner Mary Buckelew pleaded guilty to obstruction of justice for lying to a grand jury about her acceptance gifts from an investment banker as part of the sewer scandal. She was sentenced to probation and did not receive jail time.
  • Chris McNair was a former county commissioner who was convicted in 2006 of charges that stemmed from his receipt of over $850,000 in bribes from several sewer contractors. He was sentenced to five years in prison.
  • Gary White, also a former county commissioner, was convicted of bribery and conspiracy and sentenced to ten years in prison.

Jefferson County's finances are in such disarray that it cannot currently borrow at any price. A bankruptcy in Jefferson County would have a negative impact across the whole state of Alabama, and potentially all across the country. It was not apparent that the new terms would appease county residents, many of whom have started to think, incorrectly, that Chapter 9 would be a good way to walk away from the debt completely.