Just a few years ago this scenario was all too common. A man walks into a bank. He has lousy credit. He’s not current on any of his bills. In fact, he’s on the brink of bankruptcy. 

And yet, he asks for more money, and he gets it, no questions asked. 

That was then.

This is now. Jefferson County walks into a bank. The $3.8 billion of debt it has on its books already has fallen to junk bond status. It’s in technical default on all its debt and in actual default on some of it. Wall Street has given it one forbearance agreement after another for more than a year and a half. It is almost a year behind on its statutory requirement for producing audited financial statements. It’s revenue streams are in tatters. It can’t make payroll. It’s on the brink of bankruptcy. 

And yet, the county asks Regions Bank for another $25 million. The county says it needs this “bridge loan” to pay employees until the new occupational tax kicks in. The county should begin collecting that revenue next month. At some point after that, it would pay back the loan. 

Whether the county gets that loan remains to be seen, but questions are being asked. In the last week, I’ve heard all of them. How is this even possible? Why is anyone even entertaining the idea of lending the county more money, especially Regions Bank? 

After the commission’s work session last week, I decided to ask the commissioners how they could pitch this to Regions. 

Commission President Bettye Fine Collins: “First of all this county has the forbearance agreement on the general obligation bonds. That will take us to October 30. We do have that new occupational tax coming in. That’s a fact. We are going to reduce our budget this year considerably. And there are other factors at play.” 

Other factors at play? Maybe the county has a deus ex machina they haven’t been telling us about. 

Commissioner William Bell: “The only thing we can do is provide the information they require, and I’m sure they have a process they have to go through. They will make that determination.” 

In other words, the worst they can say is “no.” (Or maybe the worst they could say is “yes.”)

Commissioner Bobby Humphryes: “Well, I don’t know. I think right now you have at least four out of five commissioners that are for the bridge loan. I think they should see that as a majority that’s wanting to work with them and that’s wanting to get the county back in operation.” 

The first sentence was the most honest. I should also note that Humphryes laughed when I asked him the question, so at least he seems to recognize its absurdity. 

Shelia Smoot wasn’t at the meeting last Thursday. Commissioner Carns was there, although he wasn’t with the others. Carns is firmly against the idea of more debt. 

“If you’re in a hole, don’t dig deeper, and this is digging deeper,” Carns said. “We are in tremendous debt. We cannot pay our debts. We cannot pay our general obligation debt now.”

I asked Carns if he, as a businessman, would loan the county the money if he had it. He barely let me finish my question. 

“No, no I wouldn’t do it,” he said. 

That’s one realist out of five commissioners. 

To make matters worse, Jefferson County hasn’t yet produced an audited financial statement for the 2008 fiscal year which ended last October. Only in January did the county finally release an audited financial statement for 2007. 

In other words, not only does the county have lousy credit, but it can’t even balance its own checkbook.

And then there’s the matter of Regions Bank itself. 

The last two years have seen Regions’ stock fall through the basement. To be fair, banks have had a rough ride recently. Regions isn’t as bad off as some others, such as Colonial. But it’s not JPMorgan or Bank of America, either. The federal government won’t yet let Regions pay its TARP money back — a sign that it’s not out of the woods. 

The bank is under fire from stockholders and investors. Last week its investment arm, Morgan Keegan, was ordered by an arbitrator to pay $1.4 million to former LA Laker Horace Grant as reparations of crumby investments it made with his money. That was the largest settlement the bank has had so far, but not the only one. 

Meanwhile, stockholders are suing, too. Last week, I asked one of the plaintiffs’ attorneys, Tom Baddley, what he thought of a possible Regions loan to Jefferson County. He summed it up in one word: “Insane.” 

“I can only assume that’s its a public relations maneuver,”  Baddley said. “When have you ever heard of a financial institution making a loan to an entity that is by it’s own admission bankrupt?”

To be fair to the county, it hasn’t yet admitted that it’s bankrupt, just broke. But then again, it doesn’t have to. Everyone already knows that. 

Bridge loans are typically a stop gap on the way to a more permanent form of financing, Baddley said. The only trouble for Jefferson County is what’s on the other side of that bridge. 

“It’s akin to that Alaska bridge to nowhere,” Baddley said. “There is no permanence here.”

If Baddley’s right, and this is a public relations ploy by the bank, it’s likely to backfire. Right now Regions’ leadership’s credibility is sinking to depths of … well … Jefferson County. 

The $25 million bridge loan might be a bridge to nowhere. The only question left is who’s going to be living under that bridge when the county’s finished. 

War on Dumb is a column about political culture in Birmingham. Write to kyle@bhamweekly.com