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Thursday, Feb. 26, 2009

Debt forces Modesto YMCA to close doors

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Unable to sell its Modesto building and repay massive debt, the YMCA of Stanislaus County will close Saturday and cancel all memberships, leaders said Wednesday.

The YMCA's mountain summer camp, Camp Jack Hazard, may be its only surviving program. Off-site child care and before- and after-school programs, which serve as many as 160 children, will be suspended Saturday, pending their transition to other community organizations, leaders said.

The YMCA plans to refund any dues owed members who are paid up beyond Saturday, Chief Executive Officer Phil McGovern said.

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Most of the YMCA's 25 full- and part-time employees will be laid off, leaders said. However, in written statements leaders seemed to leave open the possibility of regrouping elsewhere if they can sell their 45-year-old headquarters at 2700 McHenry Ave.

Board member Neva Forney, 82, who has taught yoga at the YMCA for 38 years, said the decision to fold was difficult. "It's not something anybody wanted," she said.

The place where thousands have exercised over the decades was $2.18 million in debt two weeks ago, McGovern reported then. YMCA leaders had been trying since September to sell their 128,502-square-foot facility with a gymnasium, workout and weightlifting rooms, racquetball courts and two swimming pools, for $3.595 million.

"In the end, closing the facility was our last but only resort. We cannot afford to keep it open," said YMCA board chairman Bill Floyd in a news release.

"Closing our facility is a setback, but I look forward to the day when I can write to you again with news that YMCA programs are returning," McGovern wrote in a statement posted on the YMCA's Web site.

He apologized for inconveniencing families of the children enrolled in care programs. McGovern, who moved from Maryland in December 2007 to become executive director, said in an interview that he hopes to share with parents details on the transition to other organizations "by the end of the week."

Members knew, but still stunned

The YMCA has not publicly produced a financial audit for at least three years, landing it last year on probation status with the YMCA of the USA. Late in 2007, YMCA officials acknowledged being more than $2 million in debt and having spent all but $42,000 of $408,000 in restricted endowment money over the previous five years. They pledged to aggressively fund-raise and "re-earn the community's trust," according to a letter sent by board members to prospective donors.

The YMCA counted 1,281 "membership units," including families, McGovern reported two weeks ago. He refused then to forecast a closure date.

Members and community leaders said they knew the YMCA was struggling but were stunned to hear of the impending closure.

"That is going to be one big loss to this community," said Modesto Mayor Jim Ridenour, a former YMCA board member in the late 1990s. "A lot of kids and the elderly used that. I don't know how we'll be able to fill all those things they did for so many people."

Community matriarch Bette Belle Smith recalled Herculean fund-raising efforts before the building opened 45 years ago. Her niece and grandnephew served as camp counselors, she said.

"Doggone it. I always hate to hear about things like that because I know it's such a nice service to the community," Smith said. "They've been around so long. It's going to be a tough one, that's for sure."

Karen Servas was the YMCA's director until 2002, at about the height of its financial strength. Wednesday, she said, "I'm shocked and I'm deeply saddened."

Noreen Jones, 69, of Modesto said, "It's absolutely sad." She's been a regular at the YMCA's water aerobics three times a week for the past year, which has helped her lose 112 pounds in the past 2½ years, she said.

"I say you get treated right. It's going to be hard to go somewhere else," Jones said. "It's very personal here. They treat you like family."

'What are the kids going to do?'

Marcus and Cristie Nelms of Salida have been taking their 8-year-old son, Marcus Jr., to fall and winter basketball at the YMCA since he was 3. Besides improving his skill with the basketball, the Nelms said they've watched their son gain social skills and make friends.

"He was shy at first," Cristie Nelms said. "What are the kids going to do?"

Member and exercise class leader Mary Menz said she received an e-mail from the YMCA soliciting soccer sign-ups at 9:20 a.m. Wednesday. "They gave us no warning," she said.

"I was going to hang in there till the last bitter moment," Menz continued. "I guess this is it."

Bee staff writer Kevin Valine contributed to this report.

Bee staff writer Garth Stapley can be reached at gstapley@modbee.com or 578-2390.