Accrued Liquidation Costs

9 Months Ended

Mar. 31, 2023

Accrued Liquidation Costs [Abstract]

6)	Accrued Liquidation Costs

The following is a summary of the items included in accrued liquidation costs as of March 31, 2023, with comparative information as of June 30, 2022 ($ in thousands) (unaudited):

	March 31, 2023			June 30, 2022
Development costs:
Construction warranty	$	4,553		$	4,184
Construction costs		628			4,331
Indirect costs		29			170
Bond refunds		(389	)		(506	)
Total development costs		4,821			8,179

Holding costs:
Maintenance, utilities and other		27			428
Property tax		8			771
Insurance (refund)		(11	)		388
Total holding costs		24			1,587

General and administrative costs:
Legal and other professional fees		14,320			12,377
Directors and officers insurance		3,442			2,508
Payroll and payroll-related		3,112			7,989
Board fees and expenses		810			630
State, local and other taxes		135			331
Other		411			936
Total general and administrative costs		22,230			24,771

Total accrued liquidation costs	$	27,075		$	34,537

During the quarter ended March 31, 2023, the Company concluded that its liquidation activities would not be completed by February 15, 2024, the current outside termination date of the Trust. There have been significant delays in the Company’s legal proceedings where the Company is the plaintiff and the Company estimates that it may require up to an additional two years to complete its operations. The revised estimated completion date for the Company’s operations is approximately March 31, 2026. Furthermore, the ultimate recovery amount from these legal proceedings cannot be determined until they are settled.

The change of the estimated completion date of the Company’s liqudation activities resulted in an additional accrual of accrued liquidation costs of approximately $7.7 million. The additional costs are primarily legal and other professional fees and payroll and payroll-related costs. A portion of the accrued liquidation costs relate to estimated reserves for potential construction warranty claims and the administration of such claims after the Company’s liquidation activities are completed.

The Company is required to file a motion with the Bankruptcy Court to extend the termination date of the Trust beyond February 15, 2024. The motion is required to be filed within six months before February 15, 2024. The Company expects that the motion will be filed as required and that the Bankruptcy Court will grant the motion as the extension is needed to pursue additional Trust actions that are expected to yield additional proceeds to the Trust.