Symington declares personal bankruptcy

The Associated Press

PHOENIX Gov. Fife Symington filed for personal bankruptcy today after a creditor refused to forgive an $11 million debt dating to his days as a real estate developer.

The filing is the latest in a string of financial setbacks for the onetime millionaire, who was elected in 1991, promising to bring his business acumen to bear on the problems of state government.

In the U.S. Bankruptcy Court filing, he claims debts of more than $24 million from his collapsed real estate empire and assets of $61,000.

The move was prompted by a consortium of six union pension funds that loaned the 50-year-old Republican $10 million to build the Mercado, a struggling shopping center and office complex in downtown Phoenix. They foreclosed on the project in 1991 when the Mercado's disappointing revenues prevented the developer from making loan payments.

A court has awarded the unions an $11.4 million settlement.

''That settlement is far beyond my ability to pay,'' Symington said. He added that the settlement is also so large that it would keep him from recovering financially in the future.

The pension funds threatened to ask a judge to garnish Symington's salary, and he responded two weeks ago by offering to voluntarily turn over 25 percent of his $75,000 annual pay. That is a tiny fraction of the debt, which continues to grow as interest charges mount.

His lawyer said one payment has been made, but that payments now would stop.

Symington previously weathered controversy over his dual role as developer and a member of the board of a savings and loan that invested one of his projects. He was re-elected in 1994, just six months after he settled a $200 million government lawsuit that accused him and other former directors of Southwest Savings of contributing to the thrift's collapse.

Symington said his wife, Ann, who has substantial holdings of her own, is not involved in the federal bankruptcy court filing and her assets are not at risk. In addition, he said family trusts that he holds would not be used to help settle his debts.

Symington, whose great-grandfather was multimillionaire industrialist Henry Clay Frick, said those trusts were created by his grandfather in the 1940s and 1950s and that he has no control over them.

''They are worth less than $1 million, so even if they were available, they wouldn't make a dent in that $20 million,'' Symington said.

William Novotny, Symington's attorney, said he would have to appear for a meeting with a court-appointed bankruptcy trustee and his creditors in about 45 days.

The trustee would liquidate Symington's assets and distribute them among his creditors, Novotny said. He said that means creditors including the pension funds will be getting less than one-third of a cent on the dollar.

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