A bankruptcy court has failed to recognize the stake held by contributors to the Saukville YMCA; now hope for keeping the institution open rests on fundraising
Bankruptcy courts are charged with the responsibility to balance the interests of creditors and debtors in distributing the assets of failed enterprises.
Unfortunately the Ozaukee County residents who contributed millions of dollars in cash and valuable land to build the Feith Family Ozaukee YMCA in Saukville and provided financial and volunteer support for its operation for 15 years do not belong to either group and are facing the possibility of being left without the institution to which theyâ€™ve given so much when the bankruptcy of the YMCA of Metropolitan Milwaukee is settled.
The U.S. Bankruptcy Court on Tuesday ordered the Saukville YMCA sold at auction to the highest bidder. Ozaukee Press sources indicate that as many as three companies operating for-profit fitness centers in the Milwaukee area may be among the bidders. If a private company is the successful bidder, the Saukville facility could be shut down before the end of September.
That would be a profound injustice, one that could have been avoided if the court had accepted an offer made by the Kettle Moraine YMCA that would have provided $2 million for the Metropolitan YMCAâ€™s creditors and ensured that the Saukville YMCA remained open.
Selling the facility at auction is a cruel turn because it threatens the prospect of it going where it belongs, into the Kettle Moraine organization, where it would find not only rescue from the Metropolitan YMCAâ€™s financial disaster, but an expectation of a secure future.
Unlike the Metropolitan YMCA, which has imploded under the weight of an astonishing $30 million in debt, Kettle Moraine, based in nearby West Bend, is on firm financial footing, is currently debt free and owns first-rate facilities. Whatâ€™s more, its board of directors has adopted a sound business plan for a merger with the Saukville YMCA that includes a role for representatives of the latter on the board that would guide the combined operation.
The Feith Y had no such role under the ownership of the Metropolitan YMCA and is thus an innocent victim of the Milwaukee organizationâ€™s fiscal management failures. The courtâ€™s auction decision is a setback, but Kettle Moraine, with strong support from the Feith YMCA board of directors, is not giving up. It had planned to finance $1.5 million of the purchase price with bank loans and cover the remaining $500,000 through fundraising. Now it is mounting a desperate effort to raise $1 million to make an offer of as much as $2.5 million.
It should not have come to this. The court should have recognized that the thousands of families that have memberships in the Saukville Y and the contributors who paid for most of its construction costs and generously supported its operation have a valid stake in the outcome of the bankruptcy proceedings and approved the initial Kettle Moraine offer to prevent the loss of the essential community asset the Feith YMCA has become.
If the Saukville Y dies as a result of its ownerâ€™s bankruptcy, it can be chalked up as another failure of the Metropolitan organization to support this communityâ€™s YMCA. When the bankruptcy petition was filed, Metropolitan CEO Julie Tolan said that the Saukville facility and other suburban Ys earmarked for sale would be sold to â€śoperators better positioned to continue those Ys and invest in those centers for the long term.â€ť
The Kettle Moraine YMCA fits the description of those operators. Private corporations that would operate the facilities as a for-profit fitness center without YMCA affiliation do not.
The people of Ozaukee County served by the Saukville YMCA can help save their Y by supporting the fundraising effort with pledges that will be used by Kettle Moraine as collateral for increased borrowing.
To reach $1 million, large gifts by corporations, foundations and wealthy individuals will be needed, but a strong response of small contributions will help the cause not only financially, but also by demonstrating that the people of Ozaukee want, need and deserve their YMCA.
Which, of course, is absolutely true.