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Creditors in the Crystal Cathedral bankruptcy will not be able to propose a competing reorganization plan, a Santa Ana bankruptcy judge ruled Thursday. The decision paves the way for the church, founded by televangelist pioneer Robert H. Schuller, to have the exclusive right to auction off the 30-acre Garden Grove campus and site of the “Hour of Power” broadcast to the highest bidder.

In the coming days, a motion will be filed detailing the bidding procedures, said Marc Winthrop, the church’s bankruptcy attorney.

An iconic Orange County landmark, the Crystal Cathedral filed for federal bankruptcy protection in October. Last week, a reorganization plan was submitted to the court that involves selling the 30-acre campus. The church, which has seen a steady decline in donations in the last few years, owes more than $50 million to more than 500 creditors and vendors.

Greenlaw Partners, an Orange County real estate development firm, was named in the proposed plan as having offered to buy the five parcels for $46 million. The church would then lease back its core buildings, including the Tower of Hope and the cathedral, for $212,000 a month.

Winthrop said any new bidder will have to propose a “better and higher” plan. The highest bidder, if not Greenlaw, would be required to reimburse the company for its expenses. “They are in the lead position ,and they have protections that other bidders won’t have,” Winthrop said.

The company intends to purchase the property and develop several of the parcels into a parking structure and residential units. Any real estate built on the campus would need to be approved by the city of Garden Grove, said U.S. Bankruptcy Judge Robert Kwan.

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The church retains the option to repurchase the core church buildings for $30 million within the first 48 months of the lease, according to the reorganization plan. Greenlaw will reduce that price by $20,000 for each developed apartment unit.

The church, which opened in 1955, has experienced turmoil in the months since the bankruptcy filing. Financial documents related to the case revealed generous pay and tax allowances for cathedral officials, some of whom were family members.

When Schuller stepped down in 2006, he handed the reins to his son, Robert Anthony Schuller. But there were signs of discord. By the fall of 2008, the younger Schuller had resigned, and his sister, Sheila Schuller Coleman, stepped up to the senior pastor position in 2009.

The initial bankruptcy filing in October stated that “the period of unsettled leadership caused some in the congregation and viewing audience to leave the ministry, resulting in reduced revenue for an organization that exists primarily on donations.” In 2009, donations were down 24%.

A hearing regarding the church’s reorganization plan is slated for July 13.

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