Slavery Museum Faces Day In Court
By Scott C. Boyd
(July 2012 Civil War News)

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RICHMOND, Va. – The beleaguered U.S. National Slavery Museum at CWN presstime was expected in U.S. Bankruptcy Court in Richmond on June 27 for a confirmation hearing on its proposed bankruptcy reorganization.

It was facing new hurdles related to its legal counsel, a major creditor, the land donor and a storage facility.

The museum may have lost its attorney. Sandra  R. Robinson, who has represented the museum pro bono since it filed for bankruptcy, became the attorney for Culpeper County, Va., as of May 2.

The court granted her request that the bankruptcy hearing be moved to June 27 because her new job and the demands of winding down her private law practice and closing her office limited her time to prepare for the hearing initially set for June 6.

Contacted by phone in Culpeper, Robinson confirmed she would be at the June 27 hearing, but would not say whether she would continue to represent the museum.

The museum’s second-largest creditor, the City of Fredericksburg, filed an objection to the museum’s proposed reorganization plan. The city questions if it is feasible or realistic, important criteria for the court in determining whether to confirm the plan.

The museum “conservatively estimates that its first full year of fundraising will generate approximately $900,000.00, and that subsequent years’ revenue will increase by fifty (50) percent.”

The city’s objection notes that in the five years of “active fundraising” the museum averaged “significantly less than $500,000 per year.” Also, “Nothing in the Debtor’s history, or the Debtor’s Plan, suggest how this money will be raised especially in light of its past track record.”

The City points out the difficult national economy, as well as competition the museum faces from a proposed slavery museum in Richmond and the U.S. National Museum of African American History and Culture, slated to open in 2015 on the National Mall in Washington, D.C.

Celebrate Virginia South LLC, the company that in 2002 donated 38.165 acres of prime commercial real estate along the Rappahannock River in Fredericksburg for the museum site, filed a motion on June 6 to convert the museum’s Chapter 11 reorganization into a Chapter 7 liquidation.

In the 10 years since the museum was announced, the only thing ever built on that land is a 0.25-acre “Freedom Garden,” which has been neglected and overgrown for years.

When the land was donated, restrictions included a requirement that an African-American Heritage Museum be built on it. Celebrate Virginia asserts that the museum has failed to develop the property for its intended use.

The company also states that the museum’s actions over the past 10 years harmed the museum’s ability to raise money and diminished the value of the donated land. In 2002 the property was assessed at $19,000,000, but the 2012 assessment is only $7,633,000.

Citing federal bankruptcy law, Celebrate Virginia says that the court can convert the Chapter 11 reorganization into a Chapter 7 liquidation if it can be shown that there is substantial or continuing loss to the estate without a reasonable likelihood of rehabilitation or that there has been gross mismanagement of the estate. The company asserts that this is applicable to the museum.

Another party, Hilldrup Companies Inc., which gave the museum a discounted rate for storing its artifacts and other personal property, filed a motion on June 6 asking the court to compel the museum to remove its property and pay its overdue bills for storage.