Court-appointed receiver John S. Young has been paid more than $1 million since being named to operate the Jefferson County sewer department last year, according to county finance department records.

Young has been paid $1,039,311 from Jefferson County sewer department revenues after being appointed in September 2010 by a circuit judge to oversee the county's troubled sewer system.

That amount does not include payments for a team of consultants and legal advisers Young has assembled to help find a solution to the county's lingering $3.14 billion sewer debt crisis. Total payments to those experts -- including legal, engineering and rate consultants -- have also topped $1 million.

Young, who makes $500 per hour, said that his payments "sound really, really big, but at the end of the day ... if I didn't feel that I was bringing value more than I was being paid, I wouldn't be here."

Young said he has brought efficiencies to the sewer department and the possibility of savings to ratepayers.

"We are doing what we can do to become more efficient," Young said. "We believe that we are moving toward a negotiated settlement which would have single-digit rate increases associated with a low-income program there is certainly a chance to avoid a bankruptcy filing ... which would have a positive impact on the business community."

Some residents and officials have questioned Young's pay and stewardship of the sewer department. Demonstrators outside the courthouse this week, including two state lawmakers, were critical of Young as well as the Wall Street creditors they say have created a burden for ratepayers.

"I can't see what he's done for all that money," state Rep. John Rogers, D-Birmingham, said Thursday. "All I've seen him do is take money, and he still wants to raise the rates on people."

In June, Young delivered a report recommending a 25 percent rate increase for sewer customers, but he has since worked with county officials and sewer system creditors to lower that recommendation to approximately 8.2 percent a year for three years and no more than 3.25 percent per year afterward, he said.

"When I was appointed, my primary job was to operate and administer the environmental services department and increase revenues with rate increases," Young said. "When I did my analysis around the rates I basically came to the conclusion that a negotiated settlement was the way to minimize rate increases, and that's what we've been working on."

Solutions



Young has also assembled a group of consultants that included his former employer, American Water, a New Jersey-based investor-owned water and sewer company; Tennessee-based Baker, Donelson, Bearman, Caldwell & Berkowitz, which has law offices in Birmingham; and engineering giant Black & Veatch Corp.

"You're talking about an opportunity to either save significant dollars if it is done right or, unfortunately, cost the ratepayers significant dollars if it's done wrong," Young said. "So bringing in the best and coming up with the best solutions using their capabilities in the long run is going to be very positive for the customers of Jefferson County."

Rogers said the best way for the commission to get rid of Young is to file a Chapter 9 bankruptcy, although others believe the receiver may retain oversight of the sewer department if bankruptcy is filed.

"If they file bankruptcy, they get rid of the receiver for a while," Rogers said. "That gives you about 45 days to solve the problem. Then we (legislators) solve the problem for them and John Young is gone, and we keep that money that he's being paid."

A solution to the county's general fund budget woes and sewer debt crisis depends on the county reaching a final settlement with its creditors, which in turn is contingent on a special session of the Alabama Legislature being called to address the county's financial problems. The prospects for such a session are tenuous.

State Rep. Jack Williams, R-Vestavia Hills, said Young would be a real bargain compared to the estimated $1 million to $1.5 million per month in legal and other costs that the county would have to pay if bankruptcy is filed.

The money being paid to the receiver should be motivation for us to address the county's issues," Williams said. "The county is hemorrhaging right now. At some point we just have to say, irrespective of the political consequences, irrespective of the fallout, we've got to address this issue in a way that creates stability for Jefferson County to where the receiver is no longer needed.

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