(The Center Square) – The National Rifle Association announced on Friday it seeks to file for reorganization under Chapter 11 of the U.S. Bankruptcy Code. It’s part of a move the pro-Second Amendment rights organization is taking to restructure as a Texas-based organization and leave New York, where it has been incorporated for about 150 years.
The NRA filed the paperwork in a U.S. Bankruptcy Court in Dallas. A news release from the organization claims it is in its “strongest financial condition in years,” and pledges to offer a plan to fully repay claims from all valid creditors.
In its filing, the group estimated both its assets and liabilities to be between $100 million and $500 million.
In a separate letter posted on the NRA website, CEO and Executive Vice President Wayne LaPierre cited the “toxic political environment” in the Empire State for the reorganization.
“The plan can be summed up quite simply: We are DUMPING New York, and we are pursuing plans to reincorporate the NRA in Texas,” he stated.
In August, New York Attorney General Letitia James filed a lawsuit seeking to dissolve the organization. The suit said LaPierre and other current and former executives did not live up to the fiscal responsibilities for the NRA, tapping into millions in reserve funds to pay for lavish personal expenses.
James issued a caustic statement in response to Friday’s news.
“The NRA’s claimed financial status has finally met its moral status: bankrupt,” she said. “While we review this filing, we will not allow the NRA to use this or any other tactic to evade accountability and my office’s oversight.”
In November, the group agreed to pay a $2.5 million fine after state regulators determined the NRA sold an insurance plan that violated state law. That plan covered legal costs for individuals who face legal costs for cases where they claim self-defense.
The NRA countersued immediately in response, saying the Attorney General’s actions were politically motivated.
The association also was banned from selling insurance plans in the state for five years after the investigation uncovered it earned commissions on nearly 30,000 policies to New York members even though the NRA was not licensed to sell them in the state.
Reincorporating in Texas means the NRA will be in more-friendly confines. More than 400,000 of the approximate 5 million members live in the Lone Star State, and the organization has scheduled its 2021 annual meeting in Houston.
In addition to the corporate restructuring, the company said it’s contemplating relocating some of its operations to Texas or other states. That includes its headquarters currently located in Fairfax, Va. A committee will consider those options, and the NRA also announced the hiring of former 3M executive Marschall Smith to serve as its chief restructuring officer.