HB671 Alabama 2011 Session

Summary

Primary Sponsor

Oliver Robinson

Democrat

Co-Sponsor

John W. Rogers

Session

Regular Session 2011

Title

County, city or town, or municipal authority organized under Article 9, commencing with Section 11-47-210, Chapter 47, Title 11, Code of Alabama 1975, relating to the funding, refunding, process of adjustment of public debts, counties may seek bankruptcy protection under certain financial situations, Sec. 11-81-3 am'd.

Summary

HB671 would let counties and certain local governments in Alabama file for bankruptcy or debt restructuring when they face serious financial trouble.

What This Bill Does

It amends Section 11-81-3 to confirm that counties, cities, towns, and certain municipal authorities can use tools to settle, adjust, refund, or fund their debt. It also explicitly authorizes these entities to use federal bankruptcy readjustment provisions and to pursue bankruptcy or debt restructuring if they are delinquent, in default, or have creditors agreeing to forbearance. The bill establishes that debt readjustment and settlement can be pursued under these authorities, with immediate effect once the Governor signs it.

Who It Affects

• Counties, cities, towns, and municipal authorities organized under Article 9, Chapter 47, of Title 11 in Alabama, who gain explicit authority to file for bankruptcy or pursue debt restructuring in financial distress.
• Creditors and holders of public debt of these municipalities, who may participate in readjustment or bankruptcy proceedings under federal acts as part of debt restructuring.

Key Provisions

• Amends Section 11-81-3 to authorize the issuance of refunding or funding bonds and the powers needed to carry out plans for settlement, adjustment, refunding, or funding of indebtedness.
• Explicitly authorizes the governing body to take steps permitted by federal acts relating to readjustment of municipal indebtedness and authorizes these entities to proceed under those acts.
• Adds that counties delinquent or in default on public indebtedness, or those that accept forbearance from creditors in lieu of default, are specifically authorized to file for bankruptcy or enter into debt restructuring in the nature of bankruptcy.
• Effective immediately upon the Governor's passage and approval.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Counties