Judge lest ye be judged?
The following Wall Street Journal article tells of a Pennsylvania fired department whose board filed for bankruptcy failing in its dependency on fundraising events and building a hall for those events that put it deep in debt. Now on the one hand I must give the board credit for creatively financing its work but the board also loses credit for bad investing (in a building it couldn't afford), at least on the surface. Now, with a huge chunk of debt, the board has filed for bankruptcy. Is this just a really clever board that is using a clever approach to reducing its debt?
Rural Pennsylvania Fire Department Files for Bankruptcy to Save Bingo Night
- By KATY STECH
- Manu Fernandez/Associated Press
A volunteer fire department in rural Pennsylvania filed for bankruptcy to protect its main pipeline of revenue: not firefighting, but Friday night bingo games.
Officials who put the nonprofit Madera Volunteer Fire Co. into bankruptcy on Tuesday urged a judge to let them spend restricted cash needed for “[hosting] bingo games, fuel, propane, telephone services, insurance and other normal and necessary costs of business,” according to documents filed in U.S. Bankruptcy in Johnstown, Pa.
The fire department has contracts to provide fire protection to Bigler Township (population: 1,289) and Knox Township (population: 1,042), but most of its $280,000 in revenue last year came from bingo and other fundraisers like poker runs, an annual gun raffle and community dinners.
The profit from social events, however, wasn’t enough to keep them out of recent financial trouble.
Earlier fire department leaders overspent on renovations to the fire hall located at 2720 Main St., said bankruptcy lawyer Kevin Petak.
To make the improvements, the fire department took out a loan through a U.S. Department of Agriculture rural development program in 2007. It still owes about $2.1 million.
Founded in 1922, the fire department said it covers a territory of 193 square miles located in central Pennsylvania about two hours outside of Pittsburgh, according to its website. It uses a 2004 engine tanker, a 1991 rescue vehicle and a brush truck.
To get out of bankruptcy, fire officials plan to keep up their fundraising efforts. They might also diversify by hosting a few weddings, Mr. Petak said.