BRADENTON, Fla. - Attorneys representing Alabama's only theme park, VisionLand, filed for Chapter 9 bankruptcy protection on Tuesday, owing bondholders $90 million and other creditors $10 million.
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While under protection of the bankruptcy court, the seasonal theme and water park will open June 14 even as its owners try to sell it. International Theme Park Services of Ohio has been hired to market the park. The price tag has been listed at $25 million.
Meanwhile, bondholders are waiting to be paid, as they are first in line under terms of the petition filed with the U.S. Bankruptcy Court in Birmingham.
The city of Bessemer took over control of the park in April, when city officials assumed a majority of the 11 positions on the governing board, which is the West Jefferson Amusement and Public Park Authority. The park is financially supported by Bessemer and 10 other surrounding communities. The authority issued $90 million in unrated tax-exempt first mortgage revenue bonds on behalf of VisionLand in 1999. Proceeds from the term bonds, due between 2006 and 2029 with interest rates between 6%and 8%, were used to acquire, construct, and equip additions and improvements to an existing amusement park in Bessemer.
The Bessemer City Council last Friday voted to allow the park to keep $1.2 million of its revenues, which was supposed to used for debt service, after consulting with bondholders, who agreed that the park should open to maintain its value, said Gregory Worthy, an attorney with Powell, Goldstein, Frazer & Murphy who represents bondholders.
Jay Bender, with the Bradley Arant Rose & White law firm, which is representing the park in bankruptcy proceedings, said the legal action taken Tuesday will protect the park from its creditors. About $10 million is owned to creditors, including $124,000 in legal fees.
Bessemer is paying the late legal fees and a $75,000 retainer for Bradley Arant.
The 70-acre park, which includes a roller coaster and water rides, operates mainly during the summer and opened in 1998 in Bessemer.
The park defaulted on $2.9 million in debt service payments due in February of this year and last August. Of the $2.9 million semi-annual debt service payment owed in February 2001, the park paid $844,000, after defaulting on the August 2000 payment.
"Investment in the Series 1999 bonds involves a substantial degree of risk," including the fact that pledged revenues from the park itself might never be enough to cover debt service, investors were warned in the official statement.
No payments on the bonds have been made to date.
After only one season, the water park was plagued with lower-than-expected attendance, poor management, and numerous management changes, park officials said.
