MEMPHIS, TN (WMC-TV) - The economic crisis may have global implications, but it is also hitting right here at home. In fact, Shelby County government took a direct hit when the first banks began to fall.
Like many Americans, Shelby County mayor AC Wharton worries about the economy.
"The thing that I think about when I go to bed at night and wake up in the morning and leave the office in the evening is the financial markets," Wharton said.
Shelby County government started feeling the impact of a global economic crisis early on.
"The fall of Lehman Brothers really hurt us. That's what took so many things down in the European markets, and that hit us," Wharton said.
One of the foreign banks the county does business was in trouble and was included in a European bailout package. A bank that financed $511 million worth of county short term variable rate bonds.
"It's the large equivalent of an adjustable rate mortgage, some of our financial transactions were structured similarly," Wharton said.
Wharton wants to refinance $511 million in county bonds. He presented the proposal to County Commissioners earlier this week. He said it is now costing the county more to borrow money and finance some of its outstanding debts.
"It's unbelievable the impact of what's happening in the European markets is impacting us," Wharton said.
Wharton said the county must take action soon. He is asking the commission to let him resolve the issue without their approval.
"In the business world there's a saying, 'no margin no mission.' In other words, if you don't have profit. You're not clearing the bottom line. You can't do anything," Wharton said.
Wharton said if the financial crisis does not turn around, the cost of doing business in Shelby County is only going to get more expensive.
Shelby County Commissioners were given the that $500 million refinancing packet at the county commission on Monday. The issue is expected to come up when the commission's budget committee meets next Wednesday.