Bankruptcy considered as way to halt sale of Conneaut park
MEADVILLE – Crawford County officials authorized a sheriff’s sale of Conneaut Lake Park in northwestern Pennsylvania, but a redevelopment agency official said park trustees may file for bankruptcy to hold off the sale.
Commissioners voted Thursday to authorize the sale of the 122-year-old park, about 95 miles north of Pittsburgh. They rejected a revitalization plan by the Economic Progress Alliance of Crawford County, the Erie-Times News reported.
Mark Turner, executive director of the group, said park trustees will consider filing for Chapter 11 bankruptcy to stop the sale and freeze park assets, allowing the redevelopment agency to continue with plans to revitalize and expand the park.
“I think that bankruptcy could be overwhelmingly positive, especially in freezing park debt and putting existing debt – including unsecured claims and expired judgments – through the wringer, subject to determination of the bankruptcy court,” Turner said.
Officials said the park owes more than $910,000 in back taxes to the county, and the local townships and school district. A sheriff’s sale as early as October would allow collection of the money, which is a “paramount” responsibility to county taxpayers, Commissioner Jack Lynch said.
The redevelopment group proposed turning the park into a year-round resort, complete with new exposition and arts centers, at an estimated cost of up to $15 million, repaying the debt over four years through insurance settlements and proceeds from sales of park property.
County attorneys, however, said settlements could be tied up in court indefinitely and property sales might not cover the tax debt.
Pittsburgh attorney Ira Weiss, hired by commissioners to study the redevelopment plan, said the redevelopment group has experience in reclaiming and marketing former brownfield sites, but not in revamping an amusement park, especially at such cost.
“The county has no reasonable expectation of getting its tax money under this plan,” he said in joining the county solicitor in recommending rejection of the proposal.
Turner said an alternative to bankruptcy might be for trustees to seek intervention by the state attorney general’s office, because the redevelopment plan was created this spring as part of a settlement of a suit by the office.
State authorities sought removal of the court-appointed trustees, citing the tax debt and alleging lack of adequate insurance when fires burned the park’s 99-year-old Dreamland Ballroom in 2008 and its Beach Club a year ago. The trustees agreed to step down as part of the agreement.