Saturday, August 13, 2011

The Math of Jefferson County, Alabama's Sewer Bond Bankruptcy

Jefferson County, Alabama, might declare bankruptcy on a $3.1B bond for their sewer system. How come?

"...126,000 of the county's 658,000 residents use the Jefferson County sewer system....Median household income in Birmingham is $31,704 a year."
126,000 x $31,704 = $4.0B

$3.1B / 126,000 = $24,729

Who's the moron who thought this was a supportable debt load?

Source: WSJ, Consultant Ninja Analysis

5 comments:

Anonymous said...

http://www.rollingstone.com/politics/news/looting-main-street-20100331?print=true

Anonymous said...

The moron who read the book saying public spending for utilities is not done with any payback period in mind.

Anonymous said...

if $31,704 is per household income, shouldn't it be divided by the avg number of residents (individuals, say 3.5) per household? if yes, then the picture is even worse...

Techsawy said...

who read the book saying public spending for utilities is not done with any payback period in mind.

Anonymous said...

The original statement is valid - it is talking about Median, not average (or Mean income).

Median just implies that there are an equal number of people earning less and more than that number. The average will be skewed by the distribution.

Saturday, August 13, 2011