Owners of Mesa Sports Facility Legacy Park, Already in Default, File for Bankruptcy Article originally posted on AZ Central on May 1, 2023 The nonprofit organization that owns Legacy Park, the massive sports complex in east Mesa, announced Monday it was filing for bankruptcy protection, further clouding the financial picture of the park that has brought in millions of athletes and visitors, but not enough dollars. In a news release, a spokesperson for the facility said it would operate as usual while the nonprofit that owns it, Legacy Cares, goes through reorganization under Chapter 11 of the federal bankruptcy code. The sports park project, which opened in January 2022, had already been in default on its $283 million in bonds, issued by an arm of the Arizona state government. Additionally, 18 firms that did construction work on the park have filed liens against the property claiming they were not fully paid for their labor. In its bankruptcy filing, Legacy Cares said it had more than $242 million in assets, but $366 million in liabilities. Of the assets, $229 million were listed as the book value of the buildings and fields on the site, the filing said. Legacy Cares, in a notice to bondholders, said it had worked with the trustee to ensure it had enough cash to continue operating the park as usual. A telephonic hearing for creditors was scheduled for June 6, the court docket showed. In a statement, Douglas Moss, the president of Legacy Cares, said the goal of the bankruptcy filing was to “preserve this landmark facility so it can continue to serve the community for many years to come.” The news release said Legacy Cares anticipated selling its interest in the park by August. Citing the legal proceeding, the news release said Moss would not be granting any interviews. Moss was paid $298,982 in salary and expense reimbursement over the past year, the bankruptcy filing said. In bond documents, potential investors were told that should Legacy Cares enter bankruptcy, the trustee would be treated like any other creditor, leaving the judge to sort out whose claims take priority. Alan Maguire, who has served as an economic advisor to past Arizona governors and entities, said that bankruptcy judges have “huge discretion” on how to handle creditors. Some, he said, might think in hierarchical terms, placing bondholders’ interests first. Others, though, might decide to pay the smaller businesses first. “Some might be more prone to say (bondholders) bought with their eyes open,” Magurie said. “They knew there was risk.” Maguire said a judge could also decide to decrease the amount owed on the bonds so that the project overall becomes easier to sell. The facility had money troubles from the beginning, with investors told on a June 2022 conference call that the problems stemmed from inflation and the continued COVID-19 pandemic. Chad Miller — the CEO of Legacy Sports, the company that managed the park — promised investors brighter days were ahead. But one investor asked that Miller stop with the “hyperbolic” rosy comments and stick with the dire numbers in the financial reports. Miller, along with his father, Randy Miller, worked for years to bring the project to fruition on 320 acres on the eastern edge of Mesa. It was land that had been used as a proving ground for General Motors vehicles. Randy Miller and Chad Miller had been part of Legacy Cares, the nonprofit that would own the park. But both would step down and instead earn six-figure salaries managing the facility as a part of Legacy Sports USA. The bankruptcy filing showed that Legacy Sports USA was paid more than $3.5 million to run the park from February through April. In April, the Millers’ Legacy Sports company ceased managing the park. Management was turned over to Elite Sports Group, a company whose website lists no executives. A public relations firm hired by Legacy Cares has not provided any information about who runs Elite Sports Group. In bankruptcy papers filed on Monday, Michael Baggett, Randy Miller’s longtime attorney, is listed as being involved in Elite Sports Group. It is not clear in what capacity. Baggett did not return a request for comment. A group of bondholders had decided in November to do a financial audit of the park and look at restructuring the deal, asking the Arizona authority to issue new bonds that would pay off debt and keep the project going. But, by February, the bondholders said it would no longer entertain such a plan. An April filing by the trustee said that Legacy Cares was looking to sell its interest in the park. The notice to bondholders about the bankruptcy filing on Monday said that the recently-retained investment banking firm, Miller Buckfire, had already begun “preliminary marketing” for such a sale. The facility opened as Bell Bank Park. But, in November, the North Dakota-based bank asked to end its naming agreement, no longer wanting to be associated with a facility that was in financial trouble. In April, it made the split public because the facility had taken no steps to stop using its name. The facility was rechristened in April as Legacy Park: Arizona’s Premiere Sports & Entertainment Complex. Turmoil around the park also ensnared the co-founder of the architecture firm that designed it. Michael Kuntz, who was part of Icon Architectural Group in North Dakota, had raised money from investors that he hoped to use to buy a portion of Legacy Sports USA, the company run by the Millers. The North Dakota Securities Commission ordered Kuntz in April to pay back his investors. It also levied a fine of $2.88 million. Kuntz left Icon in June. The opening of the facility fulfilled a decades-long quest of Randy Miller, a Scottsdale man who had talked of creating such a spot since at least 1990. Deals to create the park with private funds fell through over the years, with three of the people Miller dealt with being found guilty of federal financial crimes. Miller was able to secure the $283 million in funding with the aid of the Arizona Industrial Development Authority, an agency created by former Arizona Gov. Doug Ducey. The authority issues bonds that are attractive for investors because their proceeds are exempt from taxation, a perk that comes from them being issued by a government agency. In turn, the projects pay a lower interest rate than they might with private financing. Such authorities typically aid projects such as affordable housing or senior living facilities that might struggle to raise private funds. But Arizona’s authority had agreed to lend its assistance to projects, some out-of-state, that on the surface seemed more like businesses. It agreed to issue bonds for a resort in Puerto Rico, a Hilton Garden Inn in Harlingen, Texas, and another youth sports facility in Hutto, Texas, that was never built. To get funding through the authority, Miller turned the Legacy Cares limited liability company he had formed in 2018 into a nonprofit. Court records say the conversion was done solely to get the tax-exempt funding from the Arizona authority. Miller choked up during the ribbon-cutting for the facility. He told The Republic in an interview that he was thinking of all the twists and turns it took to bring his vision to fruition. “I did get very emotional,” he said, “because I not only put a lot of time and energy, a lot of people believed in me.”