Morris Brown College will file for Chapter 11 bankruptcy in a last attempt to offset its reported $13 million debt to investors.
Chapter 11 is part of the U.S. Bankruptcy Code, which permits reorganization and gives federal protection to businesses unable to pay their debts. Currently, Morris Brown has no accreditation, which prevents the college from getting federal funds to help offset its mounting debt.
Last week it was reported that the college’s administrative buildings were up for auction, effective Sept. 4 after news of a looming foreclosure that has put the college at great risk. In total, Morris Brown is in $30 million worth of debt after years of financial strain after a mismanagement scandal in 2002.