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National Association of Counties * Washington, D.C.      Vol. 34, No. 2 * January 28, 2002



Enron bankruptcy has little effect on surrounding counties

By M. Mindy Moretti
Senior Staff Writer

In early December 2001, Enron, the seventh largest company in the country, filed for Chapter 11 bankruptcy and laid-off 4,500 employees. At the same time, the company disclosed that many former and current Enron employees had lost their entire retirement nest eggs when the company’s stock devalued to less than $1 per share.

And while the news and scandalous fallout of the Enron bankruptcy has been page one material since the story broke, it’s business as usual for the officials in the counties that surround the Houston-based company’s headquarters.

“The impact on the county has been minimal,” explained Harris County (Texas) Judge Robert Eckels. “What happened to those employees is tragic, but Harris County’s economy remains strong and there will be no impact on the county’s budget.”

According to officials in Fort Bend, Harris and Montgomery counties, home to Enron and many of its employees, the local impact of the bankruptcy has been minimal.

In Fort Bend County, a “bedroom community” for many of the white-collar workers at Enron, there have been no noticeable effects and none are actually expected. While the number of Fort Bend residents laid-off was unavailable, County Judge James C. Adolphus’ office said the only impact the county could potentially feel is if many of those laid-off employees relocate for job reasons. However, since that is such an intangible, county officials in Fort Bend are confident this national crisis will have little bearing on the county and its coffers.

Because the laid-off employees of Enron will receive unemployment assistance from the state and not the counties, there has been little impact on county social services, nor is any anticipated.

Some community organizations, such as the Greater Houston Community Foundation and former Enron employees have set up special funds to assist laid-off employees.

“People realize, however, that the events at Enron do not reflect Houston or Harris County,” Eckels said. “Again, our county remains strong and our community has come together for those who have lost their job.”