Friday, August 24, 2012

Morris Brown College To Face Foreclosure

Morris Brown College, one of the nation's oldest black colleges, has an uncertain future ahead as it faces foreclosure next month.

The Atlanta college has long struggled to remain open as it dealt with financial difficulties over the last decade. But now, according to a report in The Atlanta Journal-Constitution, the school is in trouble. Once boasting more than 3,000 students, enrollment is down to just 50. In the face of growing debt and shrinking support, it will go under foreclosure next month after investors called $13 million worth of bonds tied to the college.

An auction of all of Morris Brown's assets is scheduled for Sept. 4.

The bonds in question were issued by the Fulton County Development Authority in 1996. Atlanta was riding high times during this period, as cash from the Summer Olympics loomed. As security for the bonds, Morris Brown pledged pieces of its property, including the administration building. That is one of the key assets that will be up for auction on Sept. 4.

Hoping to stave off foreclosure, Preston W. Williams, chairman of the board of trustees of Morris Brown, is calling for a "National Day of Prayer" on Saturday and is calling for everyone associated with the school to donate money. The school is currently in the process of reorganizing and restructuring as well as trying to get accreditation from the Transnational Association of Christian Colleges and Schools.

The low point of Morris Brown's troubles came in 2006. After losing its accreditation from the Southern Association of Colleges and Schools in 2003, and financial support from various other organizations, former school President Dolores Cross pleaded guilty to embezzling federal funds by applying for money on behalf of students without their consent. She was ordered to pay $13,942 to the government and was sentenced to five years of probation.

The Atlanta Journal-Constitution reported last July that Morris Brown owed more than $30 million to several creditors. The school also owed $9.9 million to the U.S. Department of Education, though it had raised $500,000 in attempt to settle that debt.

You can read the full story in AJC.

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