Morris Brown College seeks federal protection, hopes to prevent auction of campus

Bishop Preston W. Williams II, Chairman of the Board of Trustees for Morris Brown College address supporters on the status of Morris Brown College. The historically black institution today filed for Chapter 11 Reorganization in the Federal Bankruptcy Court in Atlanta.

ATLANTA, Georgia - Morris Brown College officials have filed for Chapter 11 bankruptcy in a last ditch effort to prevent the 131-year-old school from being foreclosed on and sold at auction, and to give them time to regroup.

Morris Brown, which is more than $30 million in debt, was facing foreclosure next month after investors called $13 million worth of bonds tied to the college. The bonds were issued by the Fulton County Development Authority in 1996. As security for the bonds, Morris Brown pledged several pieces of property, including the school's administration building. An auction of assets had been scheduled for Sept. 4.

"The trustees are taking several deliberate actions to insure that we not only survive, but thrive," board Chairman Preston W. Williams said Saturday. "Our commitment is to focus on restructuring and making it possible for us to survive another day."

Chapter 11 is part of the U.S. Bankruptcy Code, which permits reorganization and gives federal protection to businesses unable to pay their debts.

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