Helena Christian School, faced with foreclosure of a large parcel of land and a $1.5 million debt, filed for bankruptcy protection last week.
The school, operating on leased property on Canyon Ferry Road, said in a statement that the filing in U.S. Bankruptcy court in Butte will not affect day-to-day operations.
“The school will continue to serve its students,” the statement said.
Superintendent Greg Page, citing the advice of legal counsel, had no additional comment.
The school’s directors signed a resolution authorizing the bankruptcy filing Nov. 15 — the same day district judge signed a decree of foreclosure on a 326-acre parcel near the Scratchgravel Hills.
School backers had hoped to finance the school through development of the property, but historic mining waste on the property stalled those plans.
Mountain West Bank, which had lent school supporters about $1.5 million with the land as collateral, demanded the school pay the loan down by $1 million after a reassessment of the property following the real estate downturn — even though, the school said in court filings, it had kept up to date on its pay-ments to the bank.
The bank filed a lawsuit demanding payment of the full debt in November 2010.
The Chapter 11 bankruptcy filing does not include specific financial information, but says the school has both assets and liabilities between $1 million and $10 million.
The Jan. 29 filing cancelled a sheriff’s sale of the property that had been scheduled for Jan. 31.
The school has about 150 students in Kindergarten through 12th grade.
Reporter Sanjay Talwani: 447-4086, email@example.com. Follow Sanjay on Twitter @IR_SanjayT.