A reorganization plan for bankrupt East Canyon Resort Trust has been approved, removing more than $13 million in liens and mortgages and reducing debt by more than $15 million.

The plan, approved last week by the U.S. Bankruptcy Court for Utah, will allow the resort to continue operations for more than 1,100 Utahns who purchased interest in the project.This reorganization clears the way for marketing of resort memberships to resume this fall, a resort spokeswoman said.

Condominium units at the resort hadn't been marketed in the last two years, but the resort has stayed busy attending to its time share members.

"It's been a busy summer and we've been booked solid," she said.

The resort, located in Morgan County on the south shore of East Canyon Reservoir, broke ground in 1980 as a $54 million project marketing camping sites and 200 condominium units.

When the trust filed for protection under Chapter 11 of the federal bankruptcy code, the resort included a lodge, restaurant, 32 condominiums, tennis courts and a recreational vehicle park.

Under the approved plan, resort beneficiaries, who had paid about $10,000 each their memberships, will elect a board of directors of the trust, which will be legally converted to a non-profit corporation.

The plan was approved by 97 percent of the membership and by all creditors.

Since filing bankruptcy, members of the trust participated in a fund raiser where they prepaid their contracts for a 25 percent discount. The project raised $900,000 toward a down payment to creditors and for site improvements.

Major creditors, including First Security Mortgage Co., Tracy Collins Bank & Trust, and CrossLand Savings, have agreed to reduce the resort's debt from $18.5 million to $3.2 million.

"This reorganization was made possible through the cooperation of all parties, beneficiaries and creditors alike," said Peter W. Billings Jr., counsel for the trust. "A strong committee of beneficiaries working together with the creditors permitted a compromise that pays something to the creditors and allows the resort to be free of the mortgage."