Chapter 11 announced

[ParkMan]

11 hours ago, InquisitiveScouter said:

And now services are being cut at National and pushed down to councils...with no resources to support.   I spoke with our Registrar today, and she ain't happy...

btw, I think Registrars are the most under-rated, under-paid, and under-appreciated positions in council service centers... 

https://scoutingwire.org/transitioning-member-care-to-serve-and-support-bsa-council-staff/

Interesting development.  Seems like the BSA has a real opportunity to clean up their IT systems so that the role of the registrar is substantially easier.  If ever there was a position in the professional staff that could be made easier - it is that one.

[fred8033]

18 minutes ago, ParkMan said:

Interesting development.  Seems like the BSA has a real opportunity to clean up their IT systems so that the role of the registrar is substantially easier.  If ever there was a position in the professional staff that could be made easier - it is that one.

Are registrars paid by national or council?  I thought they were like scout shop staff.  

[ParkMan]

Just now, fred8033 said:

Are registrars paid by national or council?  I thought they were like scout shop staff.  

They are council employees.

[Jameson76]

5 hours ago, RememberSchiff said:

Debtor (BSA National) seeks Order to assume unexpired leases of nonresidential properties and fix the “Cure Amounts”.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/842937_1168.pdf

Some Excerpts:

 

• Summit Bechtel Family National Scout Reserve: The Summit is a 14,000-acre high adventure facility located in the New River Gorge area of West Virginia. The real property and improvements of the Summit are owned by one of the BSA’s wholly owned subsidiaries, Arrow WV, Inc., and leased to the BSA under that certain Shared Services Agreement and Lease of Premises, dated as of February 13, 2017. Under that agreement, the BSA also provides the necessary services required to operate the Summit.

 

Will the Debtors BSA assume subsidiary Arrow WV's lease of Summit Bechtel to the BSA?   Maybe   @Jameson76 can explain.

The lease deal and the Shared Services Agreement is an interesting twist.  When I first saw this was the setup for Summit, it did seem like an accounting exercise in order to keep assets off of some register.  Not saying it had ill intent, but it may be the most transparent way to spend $750 mm on strip mine.  In many many businesses there is the company that runs the business and one may think they own the business.  When you peel the onion back you find a much more complicated view.

An example of this is  Eddie Lampert and the KMart / Sears - Sears Holding.  His group bought Sears then sold the property to another group he controlled and leased it back while Sears ran the business.  That got all complicated with the bankruptcy for them.

Not sure the BSA was actively trying to shuffle assets, but one never knows.  In many ways the new company and lease back can speed up capital approvals as leases are seen differently in financial reporting than purchases.  Real question may be what is the actual status now of the BSA wholly own subsidiary Arrow WV.  One would assume it would be embroiled in the bankruptcy and most judges would take a dim view if the organization was trying to hide assets or do shell game at this point.

[RememberSchiff]

On 6/21/2020 at 6:31 PM, RememberSchiff said:

BSA (Debtor) requested court permission to hire appraisers for four high adventure facilities located in Florida, Minnesota and parts of Canada, New Mexico, and West Virginia… This application is scheduled to be heard July 9 also when participating councils deliver assets list?

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/825916_868.pdf (128 pages)

To efficiently advance these chapter 11 cases and engage in substantive negotiations regarding the Debtors’ assets and a plan of reorganization, the Debtors have determined, in their business judgment, that they require appraisals of the high adventure facilities, each as described in greater detail below. (Note :The Debtors do not waive the right to argue that the high adventure facilities are not available for creditor recoveries because, among other reasons, such facilities are subject to enforceable use restrictions under applicable law and/or that they hold such properties in a fiduciary capacity to carry out the Debtors’ charitable mission.)The appraisals will provide the Debtors and parties in interest with important information regarding the value of their properties and assets. (page 4 of 128)

In consideration of the unique differences in geographic location, property type, acreage and land use of each high adventure facility, the Debtors have determined to retain one Appraiser to appraise each of the following (each, a “Subject Property” and, collectively, the “Subject Properties”): Florida Sea Base, Philmont Scout Ranch, Summit Bechtel Reserve, the portion of Northern Tier located in Minnesota, the portion of Northern Tier located in Ontario, Canada, and the remainder of Northern Tier located in Manitoba, Canada. Each of these Subject Properties is described below. (page 5)

• Northern Tier. The BSA opened Northern Tier—located on the boundary waters between Minnesota and Canada—as its first high adventure facility in 1923. For nearly a century, the BSA has maintained several wilderness bases at Northern Tier from which generations of Scouts have explored millions of acres of lakes, rivers, forests, and wetlands in northern Minnesota, northwestern Ontario, and southeastern Manitoba.

• Philmont Scout Ranch. The BSA’s largest high adventure facility, Philmont, was opened in 1938 on nearly 150,000 acres of rugged mountain wilderness in the Sangre de Cristo range of the Rocky Mountains in northeastern New Mexico. At Philmont, Scouts have access to a labyrinth of backpacking trails, as well as 35 staffed camps and 55 trail camps, spread across mountainous terrain ranging in elevation from 6,500 to 12,500 feet.

• Florida Sea Base. Sea Base was commissioned by the BSA as its third high adventure facility in 1980. At several facilities in south Florida and the U.S. Virgin Islands, Scouts swim, snorkel, scuba dive, and fish. Scouts also participate in boating and sailing adventures throughout the Caribbean, as well as primitive camping on several island-based settlements.

• Summit Bechtel Reserve.7 Most recently, in 2013, the BSA opened the Summit in the wilds of West Virginia. It is the preeminent summer camp, high adventure facility, and leadership training center for the millions of Scouts and adults leaders involved in Scouting now and for generations to come. At the Summit, Scouts explore the New River Gorge region through white-water rafting, kayaking, canyoneering, and advanced orienteering.

Appraiser Qualifications: Note Exhibits 1 through 6 are detailed engagement letters with BSA.

Appraisers of the Keys (see Exhibit 1, page 25 of 128) – Florida Sea Base: Appraisers of the Keys has a wealth of experience in appraising various property types throughout the Florida Keys, including residential, hospitality, marina, mixed-use, vacant, and special purpose properties.

JFW Ranch Consulting (see Exhibit 2, page 31 of 128)– Philmont Scout Ranch: JFW Ranch Consulting’s professional has over 33 years of experience appraising ranches throughout New Mexico, including properties of over 100,000 acres. JFW Ranch Consulting has an extensive network and relationships with ranch appraisers, brokers, and ranch owners with access to a wealth of market data and intelligence.

H&LA (see Exhibit 3, page 35 of 128)– Summit Bechtel Reserve: H&LA specializes in appraisal and feasibility studies of leisure properties, including campground resort properties. H&LA has experience with providing comprehensive market analyses, recognizing that particular segments of a property may have different highest and best uses.

Our (H&LA) consultants are national experts in the analysis of all types of leisure properties. We have prepared more than 3,000 studies on a wide range of hotels and leisure properties in the United States and Canada. We ha ve completed 20 campground resort studies in the United States in the last 10 years. With your project in mind, below is a sample of projects we have completed over the years that are similar to yours in property type or scope of services. A complete list of all H&LA projects can be found at our website. (page 38)

Jellystone Park Camp Resort – Larkspur, Colorado

Frontier Town Campground – Berlin, Maryland

Maddox Family Campground – Chincoteague Island, Virginia

Cook Riverside Cabins – Barnett Township, Pennsylvania:

Jellystone Park Camp and Resort – East Drumore Township, Pennsylvania

Kalahari Resorts – various locations

Great Wolf Lodge Properties – United States and Canada

F.I. Salter (see Exhibit 4, page 46 of 128)– Northern Tier, Minnesota: F.I. Salter has completed several appraisals of properties similar to the Minnesota portion of Northern Tier, including waterfront campground and residential properties. F.I. Salter is also familiar with the local market, having completed multiple assignments in the same county as Northern Tier’s Minnesota location.

Dawn M. Powell (see Exhibit 5, page 48 of 128) – Northern Tier, Ontario: Dawn M. Powell specializes in the appraisal of resort campground and recreational properties, with a particular focus on northern Ontario. Dawn M. Powell annually engages in at least a dozen appraisals of this type of property for various purposes, including acquisition financing, foreclosure, and similar circumstances. Dawn M. Powell maintains an extensive database of resort campground sales and leases.

BW Ferguson (see Exhibit 6, page 53 to be supplied) – Northern Tier, Manitoba: BW Ferguson has experience in a variety of specialized types of property, including campgrounds, fishing lodges, and outfitters lodges in Manitoba and surrounding provinces. BW Ferguson maintains a comprehensive database of comparable markets, public records, and data-sharing with an extensive network of appraisers and realtors in Winnipeg and Bissett, Manitoba

 

Scope of work, appraiser services, and fee structure pages 8-10. Further appended Exhibits of professional qualifications, business experience, etc.

 

On 8/27/2020 at 11:45 AM, CynicalScouter said:

I seem to recall there was an appraisal/study of the amount Bechtel could be sold for. This move seems to indicate they are cleaning up any claims in order to offer it up for sale to settle claims.

One down, three to go?

Update: 8/31/2020

NOTICE OF APPRAISER H&LA’S (I) REVISED ENGAGEMENT LETTER FOR SUMMIT BECHTEL RESERVE AND (II) NEW ENGAGEMENT LETTER FOR PHILMONT SCOUT RANCH

• H&LA’s assignment for Summit Bechtel Reserve is expanded to include certain additional property holdings in close proximity to Summit Bechtel Reserve, including, but not limited to, those certain parcels of real property known as Bridgeview, Teay’s Landing, Craig’s Ranch, Cunard, Stone Cliff, First Destination Park, Glen Jean Properties, Terry Beach, and Sandstone;

• JFW Ranch Consulting has withdrawn its services as Appraiser for the Philmont Scout Ranch in Colfax County, New Mexico, and its retainer has been refunded to the Debtors

• the Debtors and H&LA have agreed that H&LA will serve as the Appraiser for the Philmont Scout Ranch

• the revised engagement letter for H&LA’s assignment for Summit Bechtel Reserve (the “Revised H&LA Summit Engagement Letter”) is attached hereto as Exhibit A.

• for the convenience of the Court and all interested parties, a redline comparing the Revised H&LA Summit Engagement Letter against the version appended to the Appraiser Retention Order is attached hereto as Exhibit B.

• a copy of the H&LA Philmont Scout Ranch Engagement Letter is attached hereto as Exhibit C

• fee increases

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/843884_1204.pdf

Edited September 1, 2020 by RememberSchiff

[yknot]

I just watched one of those hour long infomercials running in my area that pegs BSA potential exposure at $1.5 billion. 

[skeptic]

Why?

 

[RememberSchiff]

I would have thought the appraisals of National's HA camps would have been completed by now. After two months, it appears that they have not begun?

Meanwhile, councils submitted their assets lists in early July.

[RememberSchiff]

Judge Laurie Selber Silverstein declined Monday to approve a proposed order submitted by the Boy Scouts to restrict the ads, saying it was “incredibly broad” and raised concerns about First Amendment issues.

“I need to understand how I can prohibit this type of speech,” said the judge. She continued the hearing until Sept. 9 and will accept additional submissions from attorneys through Friday.

Among other things, Silverstein wondered whether she would have the authority to require attorneys to include information about the official claims website and telephone number in their advertisements.

“I’m not downplaying the significance of the concerns, but of course that’s juxtaposed against the rights of attorneys to advertise,” she said.

...

Silverstein also expressed skepticism that the Boy Scouts were trying to squelch claims. She pointed to concerns that the law firm ads direct people to phone numbers and websites other than those for the official claims agent.

https://www.reuters.com/article/bankruptcy-boy-scouts/bankruptcy-judge-skeptical-boy-scouts-effort-to-curtail-ads-to-abuse-victims-idUSL1N2FX2E5

More details at this link:

http://www.wboc.com/story/42572088/attorneys-argue-over-ads-targeting-boy-scouts-abuse-victims

 

Edited September 1, 2020 by RememberSchiff

[walk in the woods]

The official ad informing potential victims of the filing deadline has been running every couple hours on Golf channel all weekend.  I assume the other NBC properties likewise.

[yknot]

I am starting to see more and more of them. From legal entities and now the court ordered advertisements by the BSA. The difference between the legal "documentaries" and the BSA spots is that the "documentaries" depict victims who appear teen to young adult while the BSA spots generally use older talent to depict their victims, closer to middle aged. The "documentaries"  are reinforcing the public perception that significant abuse is still occurring in real time to present day youth.

[RememberSchiff]

Supplemental Order:

1. Establishing deadlines for filing proof of claims

2. Establishing the form and manner of notice thereof

3. Approving procedures for providing notice of bar date and other important information to abuse survivors

4. Approving confidentiality procedures for abuse survivors

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/849049_1331.pdf

Ugh, apparently once again, rather than convert their created text document into a pdf, court officers decided to image scan it into a pdf, thus disabling cut and pasting text. So, I will quote document by snipping screen images.

 

 

 

 

 

Edited September 17, 2020 by RememberSchiff

[RememberSchiff]

There is a lot to this motion, I made summary cuts ~RS

Tort Claimants Committee (TCC) submits motion for an order annexed hereto as Exhibit A, authorizing the TCC to issue subpoenas to and directing discovery from Boy Scouts of America (“BSA” or the “Debtor”), members of the Ad Hoc Committee of Local Councils of the BSA (the “Local Council Committee Members”), and those local councils specifically listed on Exhibit B hereto (the “Additional Local Councils,” together with the Local Council Committee Members, the “Local Councils” and, together with the BSA, the “Examinees”).

The TCC seeks the entry of an order authorizing the issuance of narrowly tailored subpoenas pursuant to Bankruptcy Rules 2004 and 9016 for the production of (a) documents and information regarding assets that the Examinees contend are “restricted assets” (the “Restricted Assets,” and the documents and information concerning Restricted Assets, the “Restricted Asset Information”), 2 (b) troop and camp rosters (the “Rosters”), and (c) Insurance Policies for claims arising from or concerning sexual abuse (the “Insurance Policies” and, together with the Restricted Asset Information and the Rosters, the “Discovery Requests”)3 from the BSA and the Local Councils. The TCC needs to review and analyze this information so that it can participate in substantive discussions regarding a possible global resolution among the Debtors, TCC, the Local Councils, and the other mediation parties. 4

...

The information sought is extremely narrow in scope and well within the confines of Rule 2004 discovery and is needed by the TCC to participate in a productive mediation. While certain of the Examinees have been working with the TCC regarding the TCC’s informal document requests, the Examinees have either (a) provided insufficient information concerning certain of the Restricted Assets; (b) provided a list of Restricted Assets without documentary support for the alleged restrictions; or (c) provided no Restricted Asset Information at all.5 Moreover, the Examinees have uniformly rejected the TCC’s repeated requests for the Rosters. Finally, while the TCC is aware that the BSA has produced certain insurance policies and has retained an “archivist” to assist in identifying Insurance Policies, few, if any, of the Local Councils have provided any Insurance Policies even though they generally had independent insurance coverage prior to 1980. The Examinees must use their best efforts to locate and produce all Insurance Policies.

Since the first day of this case, the Debtor has beseeched all of the parties to move quickly towards the negotiation of a plan because it is a nonprofit entity and could not endure a lengthy and expensive chapter 11 process. That message has been echoed by the Ad Hoc Committee of Local Councils. With that exhortation comes the responsibility to provide prompt and fulsome discovery responses. The Examinees have slow-walked information on the Local Councils’ Restricted Assets and stonewalled on the Roster requests, and the TCC has no confidence that all of the Insurance Policies have been produced. The Examinees have failed to hold up their end of the bargain and erected roadblocks to the TCC’s ability to perform the due diligence required in the performance of its fiduciary duties.

Restricted Asset Information (page 8 of 19)

The TCC needs the Restricted Asset Information to assess the factual and legal basis for any claimed restriction for the purpose of making an accurate financial assessment of each Local Council. Determination of whether donor-restricted assets should be excluded from a financial analysis is complicated, and may require some or all of the following information:

 The donor or source of the asset;

 The identity of the initial recipient of each asset;

 Whether the recipient entity was independent from BSA or was a trust for which the trustee was unrelated to BSA;

 The source, manner, and timing of conveying any alleged donor restriction;

 The nature and specific language of such alleged donor restriction;

 Whether the donor restriction expressly indicated that BSA or its related party was to hold the asset in trust;

 The type of asset (e.g., cash or real property);

 How the assets were and are now held; and

 Whether the assets were commingled or transferred or spent such that their continued existence cannot be proven.

Rosters (page 10 of 19) (i.e. annual chartering information ~RS)

22. The TCC seeks the Rosters from the Local Councils and BSA,8 who the TCC is informed has the Rosters in its possession, custody and control. The Rosters will enable the TCC to verify and assess the value and scope of abuse claims against the BSA, Local Councils, and chartered organizations. In addition, the Rosters will help the TCC determine which sponsoring or chartered organizations may be implicated in abuse claims and whether such organizations have insurance policies available to satisfy the abuse claims.

23. Abuse survivors may have a legal claim against at least three different entities recognized in the BSA Charter and By-laws and its Rules and Regulations: (a) the BSA; (b) a “local council” that managed all Boy Scouting units (e.g., a Boy Scout Troop or a Cub Scout Pack) in a defined geographic area; and (c) a “chartering organization”, such as a school or church, that operated a particular Boy Scout unit in conjunction with the Local Council and BSA.

(pages 12,13 of 19)

27. As a rule, Rosters clearly identify the local council and charter organization that may be liable for abuse by a Scout leader on the roster or for abuse of a Scout member on the Roster. Many of these councils and charter organizations may want to participate in the Debtor’s bankruptcy and obtain the benefits of a channeling injunction, which means the TCC needs to know their identity and must be able to evaluate their respective liabilities to determine whether they have made a substantial contribution to the cases.

28. Even if a council or charter organization does not choose to participate in the Debtor’s bankruptcy, the TCC needs to know their identities so that it can explore whether these entities have insurance that may provide coverage for claims made in the bankruptcy. For example, it appears these entities may have purchased their own insurance separate and apart from the Debtor’s insurance, including insurance that may have listed the Debtor as an additional insured.

29. Second, the charters and Rosters will help the TCC, the Debtor, and other interested parties to corroborate certain claims, particularly if a claimant does not recall certain information about their Scouting unit. For example, from the thousands of claims that have already been submitted, the TCC is aware that many claimants do not recall their Scouting unit number (e.g., Boy Scout Troop #23), the name of the local council who was responsible for their Scouting unit, or the name of the chartered organization that sponsored their Scouting unit. Others do not recall the specific year(s) of the sexual abuse (which may be relevant to insurance coverage issues). Some claimants do not recall the names of adults who received complaints and ignored them or saw “red flag” behavior and ignored it.

30. Since the vast majority of claimants were children and teens when they were abused, it is completely understandable that they would not be able to recall this information -- some of the claimants were in second or third grade when they were sexually abused. The claimants also generally lack any meaningful ability to obtain the information because of the automatic stay and the injunction -- claimants who have filed state court actions cannot issue discovery to the Debtor or the Local Councils to obtain this information for use in filling-out their claim forms.

31. On the other hand, these claimants are struggling to recall and provide important information that is contained in the charters and Rosters. For example, Rosters may help such claimants recall or identify information such as the Troop number, the name of the camp, the sponsoring organization, the Scout leader’s name, the particular year(s) of abuse or the location of the incident(s). Furthermore, where a claimant alleges he was abused in a Council Camp but cannot recall the name, Roster would also be helpful to identify the name of the Camp and may assist in identifying perpetrators and witnesses not associated with the Camp.

32. Third, and related, the Debtor and other interested parties have suggested they may object to claims if the claimant is unable to provide some of the information that many claimants are already struggling to provide. Not only does the TCC need this information in order to identify third parties who may want to participate in the bankruptcy, or who may have insurance that covered the Debtor and/or parties who choose to participate, but no party has an interest in waiting to obtain the charters and Rosters until the Debtor or third parties start objecting to claims. The claimants should have a fair opportunity to provide as much information as possible to avoid claim objections and the substantial amount of time and money that could be devoted to objections that will easily be rejected once the claimant is provided with the charters and/or rosters.

33. Fourth, and also related, the Debtor and other interested parties have suggested they may object to claims if a claimant and/or their alleged abuser are not listed on the roster(s) for their Scouting unit.

Insurance Policies (page 15 of 19)

36. TCC acknowledges that the BSA has produced certain insurance policies and has retained an “archivist” to assist in identifying Insurance Policies. While it remains to be seen what work the “archivist” has done, the BSA has not produced (a) any Insurance Policies from prior to 1963, or (b) any of the Insurance Policies listed on Schedule A of the Discovery Requests. Moreover, none of the Local Councils have provided any Insurance Policies even though they generally had independent insurance coverage prior to 1980.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/852384_1379.pdf

Edited September 30, 2020 by RememberSchiff

[InquisitiveScouter]

9 minutes ago, RememberSchiff said:

In addition, the Rosters will help the TCC determine which sponsoring or chartered organizations may be implicated in abuse claims and whether such organizations have insurance policies available to satisfy the abuse claims.

23. Abuse survivors may have a legal claim against at least three different entities recognized in the BSA Charter and By-laws and its Rules and Regulations: (a) the BSA; (b) a “local council” that managed all Boy Scouting units (e.g., a Boy Scout Troop or a Cub Scout Pack) in a defined geographic area; and (c) a “chartering organization”, such as a school or church, that operated a particular Boy Scout unit in conjunction with the Local Council and BSA.

 

[acema606]

Chartered Organizations feeling additionally vulnerable right before the recharter season is yet another strong surge in the perfect storm of issues working against BSA at present.