YMCA attempts to bring budget back in order
MILWAUKEE - Drowning in debt, the YMCA of Metropolitan Milwaukee is trying to get its budget back in order, but that means putting some property up for sale.
It's like any other day for members at the downtown YMCA, but behind the scenes, leaders are busy trying to clean up their financial picture. Today, they sent out a letter to members, saying they've filed for Chapter 11 bankruptcy.
They're $30 million in debt. How did that happen? We asked Julie Tolan who took over as executive director just ten months ago.
"These challenges we have today did not happen overnight," said Julie Tolan, Metro Milwaukee's executive director.
In the last 20 years, the Y has spent millions on construction. One such project's here on the north side. Inside the Young Leaders Academy cost $15 million. Besides taking on new debt, the Y has been taking in less memberships and less donations.
"And you know lots of organizations, particularly nonprofits have really struggled in the last five years. Some have gone away and that was a fundamental question for us, whether or not we could really save this Y," said Tolan.
So Tolan sees Chapter 11, or bankruptcy protection, as a way to reorganize.
"We believe with everything we are that this is the best way forward for the Y, not just in Milwaukee but as I say for the region," said Tolan.
A few YMCA's have nothing to worry about like this one in Brown Deer.
The Metro Milwaukee Y will also continue to operate this Northside YMCA, as well as the Parklawn YMCA on North 46th Street, but has plans to sell the West Suburban Y, Tri-County Y, Southwest Y and the Ozaukee Y. All four have buyers. Metro Milwaukee's also hoping to sell the South Shore Y and Camp Matawa.
"So fewer owned locations also means fewer expenses for maintaining them and that's a huge part of it. We will pay down you know, a lot of our debt through this process," said Tolan.
Selling is not a done deal though. Because they've filed for Chapter 11, the banks will need to approve these transactions and so will the courts. But, the biggest message in this, if you've got a Zumba class or your children have camp tomorrow, it's all open and running business as usual.