PHOENIX — Phoenix Pride has filed for Chapter 11 bankruptcy protection, citing rising operational costs and declining sponsorship and fundraising support.
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The nonprofit, which has operated for 40 years and hosts Arizona’s two largest LGBTQ+ events, Pride Fest and Rainbow Fest, announced the filing Friday.
In a statement, Phoenix Pride said rising operational costs, a lack of sponsorships and fundraising challenges tied to the current political climate have placed significant financial strain on the organization.
Chapter 11 bankruptcy allows organizations to continue operating while restructuring their finances under court supervision.
Phoenix Pride also hosts pageants, art shows and provides resources for members of the LGBTQ+ community.
Michael McFall, president and CEO of Pride Guide USA, an LGBTQ+ resource guide that promotes organizations across the country, said he was not surprised by the bankruptcy filing.
“A lot of the big corporations are all pulling out of LGBTQ organizations, and so we’re seeing that all over, and it didn’t surprise me,” McFall said.
McFall said he believes the trend began when the Trump administration started pushing back on diversity, equity and inclusion initiatives.
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He added that other Pride organizations have faced similar financial challenges. Earlier this year, Tucson Pride announced it was shutting down.
“They’re so expensive to put on, and you know, and safety is a big, big concern, so they have to have the money for security, police, stuff like that,” McFall said.
According to bankruptcy filings, Phoenix Pride owes nearly half a million dollars to creditors.
Among those creditors is Pride Group LLC, a company that helps operate events for Phoenix Pride. The company filed a lawsuit against Phoenix Pride claiming it is owed nearly $420,000. The civil litigation was filed a few months ago.
Phoenix Pride declined to comment on the lawsuit. However, federal court documents indicate the organization is disputing the claim.
In its statement, organizers said Phoenix Pride is not closed and events that have already been planned will continue as scheduled.
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