Officials Vow to Keep Debt-Plagued School Open
One month after filing for bankruptcy, officials at the Grove School of Music in Van Nuys vow to keep it open while trying to erase between $600,000 and $700,000 of debt that had threatened to permanently close the school.
After a Florida-based arts facility dropped its plans to purchase Grove in early August, officials feared the school would be unable to raise enough money to stay open in September.
By filing for Chapter 11 bankruptcy in federal court, the school is legally shielded from creditors while it reorganizes its operations. Grove officials said they now have time to begin a fund-raising campaign to pay off debts. Because of a 25% decline in student enrollment this year and a new state tuition reimbursement law, the school lost about $1 million.