Chapter 11 announced - Part 3 - BSA's Toggle Plan

[BlueandSilverBear]

10 hours ago, CynicalScouter said:

Banned topic in this thread

 

Isn’t that where the value is though?

I would imagine COs like First United Methodist Church of Smallville don’t have much more than their building and maybe a parsonage on their balance sheets. Philmont and the Summit have secured creditors.  Local councils may have camps without mortgages, but they could be restricted gifts or held in trusts. Flood the market with former scout camps and their value drops even more. These are all difficult to pursue from an operational and practical perspective. 
 

The insurance companies and the LDS are the golden geese. It’s a cynical game, but it’s a solid strategy for the TCC. 

Edited May 7, 2021 by elitts

[fred8033]

1 minute ago, BlueandSilverBear said:

The insurance companies and the LDS are the golden geese. It’s a cynical game, but it’s a solid strategy for the TCC. 

Agree.  Your reasoning is on target.  Simple exit with a huge paycheck.

Deep pockets drive these cases.  Often the best way to protect yourself from such cases is to not have assets.

Litigants want a conclusion and cash; not some some end-date years in the future and a promise of a check five or ten years out.  I'm sure many would settle for X if 2X means ten more years, lots of additional cost and continued risk gambling the payout. 

Imaginge the legal and court costs to liquidate council assets?  Imagine the suits about disputing clear proper titles?  This forum itself has shared multiple examples of "Friends of Xamp XXXX" that have sued or theatened suit.  Examples of family members of the original donor trying to reclaim assets protected assets. 

 

[fred8033]

20 minutes ago, SilverPalm said:

... for some reason, some folks at National are digging in to save Summit, full speed ahead and damn the torpedoes. 

It makes sense though.  Philmont, Seabase and Northern Tier offer experiences scouters can get elsewhere.  Many of Philmont's outposts can be found at summer camps or elsewhere.  All the hiking, canoeing and other activities can be found elsewhere too.

BUT ... the Summit is an identify for BSA.  A gathering spot.  An event venue.  Tens of thousands of scouts can gather.  A unique property.  Plus, it's the only high-adventure base on the east coast within reasonable drive of large population centers.  It's a huge asset.  A hundred years from now it could eclipse Philmont as a BSA brand-name property. 

[CynicalScouter]

6 hours ago, SilverPalm said:

Purely speculation on my part, of course, but I would guess these documents do not support BSA National's argument that Summit is totally underwater. 

I think it could show it. There's two possibilities:

1) Summit has a good amount of positive equity but JP Morgan and BSA put the loans and play games with the financials to make it look encumbered so that the sexual abuse victim won't get it.

2) Summit is so far underwater as to be utterly embarrassing and a shock to everyone to see how much of a money pit it is.

[CynicalScouter]

Boy Scouts abuse claimants seek details of local council, insurer payments

 

Quote

The organization’s proposal has already been met with opposition from groups representing the interests of abuse survivors in the bankruptcy, including an official tort claimants' committee and a group called the Coalition of Abused Scouts for Justice. This week, law firms representing small groups of individual abuse claimants filed papers saying the disclosure materials need to include valuations of each local council’s assets, how many sex abuse claims have been lodged against each local council, and how much each council is contributing to the settlement trust in exchange for a release of abuse claims. The claimant groups say the information is necessary for them to determine whether the contributions are worth giving up their claims against their local councils.

Oh, and of course the LCs are not getting away with anything, either.

Quote

They also called the organization’s pledge to obtain a $425 million contribution from the local councils “illusory” because no firm agreement with the councils has been made.

And the letters to the judge are making an impact, at least in terms of being reported.

Quote

More than 100 letters from former Scouts were also filed in the bankruptcy case this week, sharing personal accounts of abuse and calling for the organization to be held accountable. The letters, addressed to Silverstein, were either filed under seal or partially redacted to protect the writers’ identities.

 

Edited May 7, 2021 by CynicalScouter

[CynicalScouter]

11 hours ago, BlueandSilverBear said:

I get the impression that the council office is relatively sophisticated and has access to the resources to do what is in it's own best interest.  I would be surprised if other councils aren't doing the same.

Most Councils are not Circle Ten. My own council is a tiny, fraction of Circle Ten and has the same level of resources. We are relying on a volunteer lawyer as whatever the Ad Hoc Committee of Local Councils is telling the Key-3.

That's not to trash on Circle Ten, I mean great for you. The other councils are going to get slammed, hard.

1 hour ago, ThenNow said:

Deleted by Moderator

 

Edited May 7, 2021 by elitts
General discussion of attorney fees and lawyers isn't permitted in this thread

[SilverPalm]

9 hours ago, fred8033 said:

It makes sense though.  Philmont, Seabase and Northern Tier offer experiences scouters can get elsewhere.  Many of Philmont's outposts can be found at summer camps or elsewhere.  All the hiking, canoeing and other activities can be found elsewhere too.

BUT ... the Summit is an identify for BSA.  A gathering spot.  An event venue.  Tens of thousands of scouts can gather.  A unique property.  Plus, it's the only high-adventure base on the east coast within reasonable drive of large population centers.  It's a huge asset.  A hundred years from now it could eclipse Philmont as a BSA brand-name property. 

In truth, I have no real idea what Summit is now or what it is intended to be. What about Summit is so integral to the Scouting experience that the BSA is willing to risk the very survival of the program over it? What does Summit have that the other HABs do not, that the local camps do not?

And, frankly, I'm not on the East Coast, which might also bias me toward keeping the sites which are geographically closer to me. There is already one HA base on the East Coast, one near the West, and one in the extreme upper Midwest. Ditching these traditional HAB to save the new one on the East Coast just smacks of coastal elitism to me... not everyone wants to live in New York or Boston, despite where National is located. It seems a poor calculus to me to lose three bases spread across the country to save one on the extreme end of the country, but that's just my opinion.

I honestly don't know why Summit exists at all - we've done just fine with Jamborees at existing campsites. If National's plan is to dump those local camps and force Scouts to make a pilgrimage to the East Coast for services they currently have locally (even if those services might be flashier or prettier out East), I do have a problem with that.

[CynicalScouter]

8 minutes ago, SilverPalm said:

I honestly don't know why Summit exists at all

At this point: stubbornness and institutional inertia. There have been people here on this forum and I know I've heard it from folks I know who were in national level positions a decade ago that even back then indicated that whatever case there was to make for Summit past a certain point it became something akin to throwing good money after bad.

First rule of holes: when you find yourself in one, stop digging.

But I also think it is just as plausible, and TCC certainly thinks so, that Summit is in fact at positive equity at this point and that BSA and JP Morgan just threw on a promissory note (with NO maturation date and NO interest) to try and shield/shell game the property.

It is after if BSA leadership is putting Summit ahead of even scouting itself.

Edited May 7, 2021 by CynicalScouter

[Eagle1993]

13 minutes ago, CynicalScouter said:

At this point: stubbornness and institutional inertia. There have been people here on this forum and I know I've heard it from folks I know who were in national level positions a decade ago that even back then indicated that whatever case there was to make for Summit past a certain point it became something akin to throwing good money after bad.

Let's ignore the difference between Arrow WV & BSA as that always seemed a bit questionable.

Why would BSA want to keep Summit through bankruptcy?

• National Jamboree every 3 years, perhaps World every 10.  Generates a ton of excitement & positive revenue.
• Annual summer camps and big HA adventure option for big population areas.  Again, excitement & revenue.
• Ability to provide summer camp as council camps in the region are lost to bankruptcy. ... Not yet true ... but I think we need to be prepared for this eventuality.  Many councils will likely have no summer camps going forward.  In addition to Summit, I would not be surprised if Territories start managing summer camps through selected councils.  There are already a ton of rumors in other locations (FB & Reddit) of this coming as early as 2022.  Even the TCC is showing where there is overlap in camps (so sell one and keep the other).
• If they give up Summit, they may then end up risking their stance on other HA bases.

Why would BSA want to lose Summit?

• Still massively in debt (probably upside down on the loan).  

JP Morgan?

• Likely realizes the value of the property is under loan amount, so has no desire to call in the loan.  They are motivated (as we see in the bankruptcy) to renegotiate terms.

I think Summit was a mistake as it took too much funding .. but at this point, the question is should BSA fight for the right to pay off $150M? more to keep Summit.  What they spent previously is already lost.  I would probably give up Summit to save Philmont. 

That said, I have several scouts that went there (and nephews) who rave about the place.  I honestly heard more positive comments and excitement from the scouts that went to Summit than scouts on other trips (Philmont, Sea Base, etc.)  That could be because it was a Jamboree ... or it could be that my older scouter views of what I think is fun (hiking/canoeing) might not be what scouts want (ATV, zip lines, BMX, hanging out with a large group of scouts, etc.).  

[elitts]

Ok, well, I see that we are still having trouble limiting ourselves from the discussion of lawyers. 

I've gone through and hidden a number of posts when the entire body of the text wasn't acceptable and edited a few more posts when portions of the text were acceptable when other sections weren't.  I've also deleted posts and quotes that refer to a post I've hidden.  I tried to be even-handed, but if you think I was unfair, please let me know and I'll present the issue for consideration by the other Moderators.

In an attempt to avoid having to keep hiding posts, I'll be more specific on what is and is not permitted within this thread.

PERMITTED:

• Factual statements regarding lawyers involved in the bankruptcy;
• Factual statements regarding attorney fees for the bankruptcy;
• Discussion of involved attorney actions, statements and filings;

NOT PERMITTED:

• Discussion or comments regarding the fee structure attorneys use;
• Discussion or comments regarding the legal profession in general;
• Any comparison of attorneys to any other profession, animal or object;
• Discussion or commentary regarding the integrity or nature of attorneys beyond specific actions taken by attorneys involved in this case;
• Any mention of any variety of scavenging animal;

[RememberSchiff]

We, well New World 19 LLC,  lost money on hosting the World Jamboree at Summit.

I have wondered if Summit has higher revenue from non-scouting events.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/812000_374.pdf

In defense of Summit, it has more statues than any HA base or scout museum and has also changed the GTSS to allow alcohol to be sold and consumed on scout properties hosting non-scouting events.

Maybe Bechtel will buy Summit back for their Bechtel University

My $0.02,

Edited May 7, 2021 by RememberSchiff

[69RoadRunner]

It's a long thread, maybe I missed this, but if BSA is upside down on Summit, then it's a liability, not an asset, right? The property can't be sold and proceeds given to plaintiffs if the loan exceeds the sale price. That would be making BSA's creditor lose.

[Eagle1993]

10 hours ago, fred8033 said:

Seems statues of limitations might only exist when you don't interact with other people.

I think this case shows the issue is complex and dynamic.  Ideally, all COs & LCs can work through this bankruptcy and eliminate future risk.  Otherwise, we are likely looking at a decade+ of Council by Council, CO by CO going through this mess.

Note that in Illinois, today, there is no SOL for civil sex abuse cases.  However, they also do not have a revival window (you can't go back to 1960 and use today's laws).  Illinois did pass a window, but their Supreme Court found it unconstitutional.

In this case ... if it proceeds ...it would go to the jury to decide.  All of this is specific to Illinois and based on Illinois law.  I think it just points out another variable where LCs and COs should not get too comfortable avoiding involvement in this bankruptcy. 

I would like my council to discharge their risk, even if it means selling a camp.  That way, they can work on the program, hiring, getting donations, etc. without this cloud on the horizon.  

[CynicalScouter]

6 minutes ago, 69RoadRunner said:

It's a long thread, maybe I missed this, but if BSA is upside down on Summit, then it's a liability, not an asset, right? The property can't be sold and proceeds given to plaintiffs if the loan exceeds the sale price. That would be making BSA's creditor lose.

This is what TCC wants to know and BSA and JP Morgan won't say.

There are several questions:

1) Who the debt is payable to. The promissory note issued to Arrow, WV and payable on demand is payable on demand to BSA. This is part of the shell game, that Arrow, WV really isn't an entity separate of BSA. Thus WHATEVER value Summit has should be considered BSA equity.

2) The property is worth more than the (legit) debt. The other argument is that the debt is inflated to make it look worse than it is. They took a second mortgage on Summit to make it appeared more encumbered than it is, but that cash is sitting somewhere and the minute the bankruptcy ends, the money gets returned. This was, in part, why TCC noted that the promissory note has NO interest and NO maturation date. That's not a legit loan; that's trying to hide assets from creditors, in effect telling JP Morgan "hold our money off our books for now, but when this blows over, we'll want it back."

3) The property could be sold TODAY, any/all debts paid, and STILL have money to be put into an abuse settlement fund. This is a modified version of #2.

[ThenNow]

Would someone be kind enough to briefly list (or point me to a link) of the professional Scouter tiers? You talk about Key 3 and SE, DE and such. I recall our Scout Executive and District Executive, but don't have a working knowledge of the chain of command, if you will. It might help me understand who's making decisions (or not) at the various levels. Thanks very much.