Historic Bacone College taught generations of Native students. Now it's struggling to survive

A struggling Oklahoma college that has graduated generations of Native American students filed for bankruptcy Friday as its future remains in doubt.

Bacone College officials hope voluntary bankruptcy will allow them to save the school’s historic Muskogee campus in the face of more than $4 million in debts, said Leslie Hannah, Bacone’s new interim president.

He said the debt reorganization process could take more than a year. Even then, it remains unclear whether the historic school can survive.

The last class of nine students graduated in May. Administrators aren’t enrolling any other students until the college’s finances have improved. A skeleton crew of five people is running what’s left, Hannah said.

“If and when we emerge from this, we are going to most likely have to partner with another college somewhere,” he said.

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Decade-long struggle for financial stability escalates for Bacone College

Bacone has struggled to find stable financial footing for more than a decade. The problems escalated in recent years as enrollment declined and financial support dwindled.

In Chapter 11 bankruptcy papers filed in Muskogee federal court, the school disclosed more than $1.5 million in unsecured debts owed to utility providers, insurance companies, lenders, the Internal Revenue Service and its longtime lawyer.

A judge ordered Bacone officials to provide a more complete accounting — including a list of secured creditors — to the court by July 5.

The bankruptcy comes after years of legal fights in state court over Bacone’s inability to pay its bills. Those lawsuits led to the school being listed twice on the sheriff’s auction block. But both sales were called off, including one as recently as December.

The bankruptcy proceedings will likely pause any further actions in state court, including a hearing set for July 29. An attorney for the school’s largest known creditor, Utah-based Midgley-Huber Energy Concepts, did not return a message to discuss the bankruptcy.

Bacone opened in 1880 as a Baptist academic institution for tribal citizens. The school retained its ties to many Oklahoma tribes for more than a century. It became known for its arts program that fostered several notable Native American artists.

Leaders want to save Bacone College — but don't necessarily agree on how

Hannah said he would like to see Bacone rebrand as a satellite Indigenous studies campus of another college, though he said not all of the school’s seven board members share his vision.

He said board members do agree, however, on saving the institution in some way.

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Hannah, who also directs the United Keetoowah Band’s education department, took over Bacone’s top post in the spring. He said the school has little money in the bank, and that land and buildings accounted for nearly all of its assets.

In Bacone’s most recent tax filing, which covered August 2020 to July 2021, school officials disclosed $1.1 million in losses and said they spent $1.7 million of the $2 million in cash on hand. The school’s accrediting body, the Higher Learning Commission, assigned it a “financial distress” designation in 2023.

Prior administrators tried to save the school by turning it into a federally overseen tribal college. A handful of tribes agreed to back the plans.

But U.S. officials rejected the school’s requests, likely because of Bacone’s historic affiliation with Baptist groups, Hannah said. The school then cut all of its religious ties. In hindsight, Hannah said, that move exacerbated Bacone’s woes. Annual financial support from Baptist organizations vanished.

As questions about Bacone’s future grew, so did concerns about its collection of significant Native American artworks. Most of those pieces have been moved off campus to protect them from theft and vandalism, and a federal grant is covering the costs of archiving and cataloging the works, Hannah said.

He said historical documents from as far back as 1791 that had been stored in Bacone’s library basement also will be part of the archival project. The school is registered on Oklahoma's National Register of Historic Places for its significance to education, arts and architecture.

This article originally appeared on Oklahoman: Bacone College in Oklahoma files bankruptcy, facing millions in debt