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Last-ditch ‘Save the Y’ campaign begins
Lake County Family YMCA plans to close the Waukegan branch on Oct. 31. | File photo
Save the Y effort
Those interested in contributing to the Y can deposit in-person or mail contributions to the Lake County Family YMCA. Secure boxes will be located at both Y facilities, 700 Lakeview Parkway, Vernon Hills, and 2000 Western Ave., Waukegan.
Donations will be returned if the fund-raising goal — a minimum of $5 million — is not met, said a spokesman.
For more information, call the Northern Lake YMCA at (847) 360-9622 or the Central Lake YMCA at (847) 367-6797.
Article Extras
Updated: October 3, 2012 6:28PM
The Lake County Family YMCA, which last week announced the Oct. 31 closure of both of its facilities — in Waukegan and Vernon Hills — is launching a last-ditch fund-raising effort.
Y spokeswoman Ann O’Connell said Wednesday the Y’s board of directors has approved a “Save the Y” campaign that will try to raise between $5 million and $8 million by the end of October.
“The board has been overwhelmed and thrilled by the outpouring of community interest — people who want to know how they can help us,” O’Connell said. “Really, our board would love nothing more than to keep the Ys open.”
Members and employees have been critical of what they claim has been a lack of communication about the nonprofit’s financial woes. About 50 people on Monday attended a rally outside the Waukegan Y at 2000 Western Ave.
Waukegan 1st Ward Ald. Sam Cunningham, whose teen daughters learned to swim as tots in the Y’s popular aquatics program, and other leaders in the city where the Y has been a staple for 100 years, are angry at what appears to be an abrupt decision to close. Late Friday, the Y began handing out closure letters that cited “insufficient financial resources to continue operations.”
“Something’s wrong, something’s really wrong,” Cunningham said. “There’s a lot of unanswered questions. The board owes us a better explanation. They had to have known about this months ago. We need to sit down and get details so we can come up with a game plan.”
Y member Waukegan Township Supervisor Patricia Jones, who said four generations of her family, including her 84-year-old mother, use the Y in Waukegan, announced a meeting to explore rescue options, which will be at 10 a.m. Friday at Park Place, 414 S. Lewis Ave.
“If we can’t prevent the closing on Oct. 31, my goal is to see when in 2013 the Y can re-open,” Jones said.
Anne Veit, YMCA board chair of communications and marketing, said the agency has “privately” tried to drum-up support from community partners. She declined to say who was approached, but said they were non-governmental entities.
A source, who spoke on the condition of anonymity, said Lake County Y leadership met with bankruptcy attorneys as early as last spring and also approached the Y of Metropolitan Chicago about a possible takeover. The metro Y purchased the YMCA of McHenry County after it filed for Chapter 11 bankruptcy in 2011.
According to an IRS return filed for 2010, the Y was operating at a $1.1 million deficit, claiming annual revenues of $5.4 million and expenses of $6.5 million — and showing a debt-to-asset ratio of a staggering 72 percent — with total assets of $10.8 million. Mortgage and interest debt, incurred in 2007, total roughly $8 million.
Total expenses included $3.2 million in salaries and wages. The top two salaries, for the CEO (Lynda Chott, who resigned in September to become CEO of the YMCA of Northwestern DuPage County) and CFO (Jim Morse, who left in 2011) reportedly totaled $156,000.
“Membership has dropped, contributed support has dropped, the recession hit and revenues have been declining,” said the Y’s finance director, Jim Malecha. “That doesn’t cover the overhead and it doesn’t cover the mortgage payment. We’re still not covering our fixed expenses.”
Veit said the board had done “tons” of fund-raising and had themselves donated to the cause.
“The reason we didn’t do a ‘Save the Y’ campaign is the gap was so big and, to be honest, it felt insurmountable,” she said.
The Y’s 2010 return reported an anemic $45,000 net income from its major fund-raiser, an annual dinner-dance. The agency subsidized 40 percent of its 2,300 total memberships in 2011 — offering scholarships and reduced fees to seniors, single parents and low-income families.
“That increased as the economy went down,” Veit said. “In my mind it’s a perfect storm. We have more people who need us, but who can’t afford to pay the full membership cost and at the same time contributed support went down.”
The Y tiptoed through financial hot water this summer when the U.S. Health and Human Services’ Office of Inspector General demanded repayment of $975,000 in what it called “unallowable” Early Head Start grant expenditures.
Former CEO Chott blamed a lapse in record-keeping. The Y pulled out of the Early Head Start program last spring, announcing it could no longer afford to offer the program.
“The Y did provide the services,” said O’Connell. “That has really nothing to do with the decision to close both branches.”
Asked if the YMCA plans to enter bankruptcy proceedings, O’Connell hedged.
“We’re working with legal advisers in evaluating all options for appropriately maximizing value for its stakeholders,” she said.
Stakeholders, O’Connell said, include creditors. Employees at the two facilities number 134.
Staffer member Cheryl Rafferty contributed to this report.
