Small Alabama city files for bankruptcy
A small city in Alabama has filed for bankruptcy after taking an unexpected financial hit due to the coronavirus pandemic.
Fairfield, Ala., located roughly eight miles from Birmingham, filed for Chapter 9 bankruptcy protection on Tuesday, saying that it had “exhausted its options” financially after years of trying to firm up its financials, Bloomberg reports.
According to Fairfield’s filings with the U.S. Bankruptcy Court for the Northern District of Alabama, the city listed assets and liabilities between $1 million and $10 million, the publication says.
“The city has faced a substantial decline in revenues in recent years due to economic forces beyond its control,” a resolution from the city reads.
“Our expenses greatly exceeded our revenues, so we’re just seeking a fresh start,” Fairfield Mayor Eddie Penny told The Birmingham News. “It gives an opportunity to reorganize, reassess our finances.”
Penny added that several businesses in the municipality had shuttered because of the pandemic.
A municipality filing for bankruptcy is a rare move, though the county which Fairfield is in — Jefferson County — went bankrupt in 2011.
Fairfield is a predominantly black community, with a population of around 11,000. One-fifth of its residents live in poverty, according to data from the U.S. Census Bureau.