Bacone College’s Board of Trustees filed for bankruptcy last week after receiving legal guidance that it was their only chance to keep the Muskogee campus off the real estate market.
Utah-based company MHEC, Midgley-Huber Energy Concepts, has been attempting to sue Bacone for two years over uncompensated HVAC work done on the campus. MHEC has put the campus on auction twice in the past two years. Each time, the auction was canceled with less than 24 hours’ notice.
Former Bacone Interim President Nicky Michael said she never knew why the sale kept getting canceled.
Current Interim President Leslie Hannah said in a Tulsa World interview Thursday that the sale was canceled because MHEC kept finding other creditors, so the company withdrew to add the other creditors to its lawsuit. The last land sale in December was canceled 40 minutes before it was to begin, as more creditors popped up claiming to be in line before MHEC.
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“MHEC is not just wanting their piece of the pie. They’re wanting the whole pie, so other people who had a claim on Bacone, MHEC just added them to the suit. They even added a John Doe space, just in case somebody else popped up,” Hannah said.
He said the board’s decision to enter into bankruptcy is an attempt to save the campus and the college.
“We’ve been advised by multiple attorneys that if MHEC has tried a land sale twice, bankruptcy would take precedence over that, and they could not make us go to land sale again,” Hannah said. “If we lose the campus, we lose the whole college.”
The judge asked for a reorganization plan before July 5, and Hannah said it was submitted at the same time the board filed for bankruptcy. The plan consists of disclosing debts owed to utility and insurance companies, lenders, the IRS and attorneys and the school’s plan to compensate each entity.
“Our bankruptcy attorney said the judge was pleased,” said Hannah. “We might have to tweak a few things, but it’s a sound plan. He approved of it.”
Bacone is suspending academic operations for one year. Hannah hopes it will have a soft opening next fall semester, accepting a couple dozen students and perhaps starting with online courses.
“As many problems as Bacone has, one of the problems they have is healthy housing and healthy buildings. Some of those buildings are infested with mold. I don’t want to house any students in substandard housing,” Hannah said.
The board doesn’t know where it will get funding for the renovations at this time, but Hannah said the renovations are “on the side burner until we get as many of these debtors off our back as we can.”
The Tulsa World attempted to contact MHEC but was unsuccessful.
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