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Offers are pouring in to buy CEDU schools Posted: Saturday, Apr 02, 2005 - 08:26:30 am PST By LUCY DUKES Hagadone News Network
BONNERS FERRY -- More than a dozen offers to purchase Brown Schools facilities in various combinations or individually have been made in recent days, but no deals will close until bankruptcy trustee George Miller has had a chance to assess the properties. Miller said he has not rejected any offers and is trying to sell the schools as quickly as he can, but he doesn't want to risk a dispute in sale process."I don't want potential suitors to object to the process because it was too quick," he said. "A legal fight in a bankruptcy court just delays the whole thing and would be counterproductive."
"We're hoping that it goes through in an orderly process," he said. Miller also said he must still investigate what went wrong to cause Boundary County's biggest employer to go bankrupt, costing 250 jobs in the Boundary County area. Now he is responding to hundreds of phone calls, trying to resuscitate the schools and talking to parents, staff and others. Miller plans to be in Boundary County early next week to look at the schools owned by CEDU, which operates under the Brown Schools umbrella. CEDU operated Northwest Academy, Boulder Creek Academy and Ascent in Boundary County and Milestones in Coeur d'Alene. It operated Rocky Mountain Academy until February this year, when the corporation closed down the school, saying RMA could no longer attract quality staff and students. Offers have been made on all the schools in each in each state where Brown Schools operates, including Idaho, California, Vermont, Texas and Florida. Offers have also been made to purchase different combinations of schools, as well as individual schools. "It runs the entire spectrum of interest," Miller said. Until they are sold, the court has authorized paying minimal staff to continue operations, to "keep the heart beating." Most of the staff left after CEDU abruptly announced last Friday it was closing down all its schools. Although CEDU employees were told Thursday that CEDU could not make payroll and they would not be paid for three weeks of work already done, none realized the financial situation was so dire. Parents who prepaid tuition did not get refunds. Some lost tens of thousands of dollars and many were angry, saying the suddenness of the closure demonstrated lack of concern for children in CEDU's programs. CEDU did not disclose the cause of the financial difficulties, attributing them to "a number of factors." Idaho Commerce and Labor officials were told of the closure late last Friday and faced an onslaught of newly-unemployed CEDU workers earlier this week. Commerce and Labor officials were still trying to find answers as the week progressed. Officials expect the seasonally-adjusted unemployment rate to rise from 6.5 percent in February to 12.7 percent in April. Miller said the announcement was sudden, he believes, because Brown Schools had intended to file chapter 11 bankruptcy for some time, which would have allowed for reorganization. Instead, negotiations broke down, Brown Schools filed Chapter 7 bankruptcy, schools were shut down, employees were let go with no notice and students were abruptly sent home. Brown Schools listed assets of $1 to $10 million and debts of $10 to $50 million in the bankruptcy documents filed in Delaware. The corporation has more than 200 creditors. Since the closure, emotional-growth education organizations, individuals and groups have rallied to help parents and students. Parents of Boulder Creek Academy students have set up an account at Wells Fargo to help former CEDU employees. The former employees have also lost access to health insurance and their 401(k) plans have been frozen, allegedly because money paid by employees wasn't put into them prior to the bankruptcy filing. Miller said he does not know if the employees will eventually get their back pay. POST YOUR OPINION
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Bonner County Daily Bee
P.O. Box 159 / Sandpoint, Idaho 83864 / 208-263-9534
Bonner County Daily Bee Online is updated at 10am PST.