As promised, Duluth YMCA CEO Chris Francis met with the Cook County Community Center Steering Committee on Monday, March 26, 2012 to present the results of the YMCA’s preliminary look at finances. Although there are still a lot of unknowns, Francis said, “When I was all done with this, it was actually kind of exciting.”
Francis said the preliminary estimates for revenue and expenses for a Cook County YMCA were calculated in part on operations of the Mesabi YMCA, a 30,000-square-foot facility. He first detailed the Mesabi facility’s annual revenue—$711,000—from contributions, special events, United Way support, memberships and program service fees. He said the Mesabi facility, unlike a Cook County facility would, receives no governmental support. He then described the Mesabi Y’s expenses, which total $704,561.
The Mesabi YMCA has 1,800 members.
Researching revenue for Cook County YMCA
Francis shared a spreadsheet detailing estimated revenue and expenses for a Cook County YMCA prior to the new facility being built and for the first five years of operation. He first pointed to contributions prior to construction of the facility, which he had estimated at $20,000. “I think that is low. I’d like to see that much higher,” said Francis. He said that is likely with the possibility of the establishment of an endowment or “naming-rights” support.
Membership dues were listed as the primary revenue source, estimated at $182,400 in the first year to $270,000 in the fifth year. Francis based that income on 380 members in the first year to 500 in the fifth year at an average membership fee of $40 in the first year—to $45 in the fifth year.
The steering committee asked Francis how he arrived at the estimated membership fee and Francis said it was an average of an individual membership of $30 and a family membership of $50.
Program service fees (such as swimming lessons, fees for flag football, etc.) are another large revenue item at $63,000 in the first year to $108,000 in the fifth year. Other revenue line items included special events, which Francis estimated could raise $5,000 in the first year, increasing to $13,000 in the fifth. United Way is another revenue source for the YMCA, possibly bringing in $8,000 – $10,000.
The total revenue estimate, with no government subsidies or grants, for the first year was $234,000 and $359,000 in the fifth year.
“I’m very confident these are conservative numbers,” he said. “I believe these will be higher, but I don’t want to use pie-inthe sky numbers.”
Estimating expenses for Cook County Y
The estimated expenses were then reviewed, with salaries and benefits being the largest line item at $68,750 prior to the facility construction to $206,640 in the first year, up to $267,525 in the fifth year. The number of employees ranged from one prior to construction of the facility to four full-time and 20 part-time employees in the first year to four full-time and 30 part-time in year five.
Other expenses were listed such as supplies, telephone, equipment maintenance and rental, printing and promotion, employee travel and training and more, totaling $195,432 in the first year of operations to $245,752 in the fifth year.
The bottom line, acknowledged Francis, was a “negative number,” ranging from a deficit of $71,398 prior to construction of the facility to $167,752 in the first year to $153,877 in the fifth year. “Although it’s red, I’m confident we can find a way to make it work,” he said.
He said the financial picture painted by YMCA did not include any government support and was very conservative on potential funding from contributions and grants. “I think I was high on expenses and low on revenue,” Francis told the steering committee.
Mark Hennessy, Resource Director for YMCA USA added, “There would also be some savings by attaching the facility to the school building—maintenance and snowplowing, for instance. There would be a lot of synergy if that happens.”
Steering committee members asked a lot of questions and expressed concern about public reaction at hearing these preliminary numbers. Francis reassured them that there were no “red flags.” He said, “Looking at these numbers—it’s positive.”
Maggie Barnard, events director with the Cook County Visitors Bureau, agreed that these are “big numbers.” She said, “They are the same numbers as a few months ago. They halted this planning— rightly so. We couldn’t at that time meet the gap between revenue and operations. Now we’ve found a way to move forward with the Y. They have a long history of fundraising and operating. This is a very positive move.”
Still considering the concept of attaching to school
Commissioner Sue Hakes asked, “What’s the next step?”
The next step, said the YMCA representatives, was a demographic study by SEER Analytical, an expense of $2,000, which had previously been approved by the Cook County commissioners. He also said the SEER Analytical study could take up to 30 days to complete and he believed the SEER Analytical study would have similar results as the YMCA study.
There was some discussion about whether or not the ISD 166 school board would support the concept of attaching the community center to the west wing or not. School Board Member Jeanne Anderson, the only school representative at the steering committee meeting, said the issue would be discussed at a work session at 4 p.m. on April 11. She said the school board didn’t know yet what the costs would be to repair the community education gym floor, replace ceiling tiles, and make other repairs. She said it is hoped that School Maintenance Director Mike Groth would have that information at the April 11 meeting. However, she added, “The reality is, we are going to be spending money no matter what. I see this as a great opportunity, but we do need some solid numbers to make that decision.”
Depending on the outcome of the school board meeting, the steering committee agreed it needed to then take the concept of attaching the school to the community center and the partnership with the YMCA to the county board. At press time, that discussion was scheduled for April 17 from 1 – 3 p.m. at the Cook County commissioner’s room.
Then, said Steering Committee Chair Paul Sporn, the steering committee needed to meet again. That follow-up meeting was scheduled for 9 a.m. – 3 p.m. on April 23.
Community member Mike Carlson asked if the steering committee planned to have any sort of public meeting during this process. Committee members agreed to schedule a “Community Input Session” the day before the school board meeting so YMCA CEO Chris Francis could attend both meetings. The public meeting will be held 5 – 7 p.m. on April 10 in the community education gym.
Cook County Community Center Community Input Session
April 10, 2012
5:00 – 7:00 p.m.
Community Education gym
In other business:
. There was discussion on whether a YMCA representative should be named to the steering committee. Commissioner Sue Hakes asked if it was premature to do so, since the county had not yet agreed to become a branch YMCA. Steering Committee Chair Paul Sporn said he thought it was time. “It shows the Y that we are serious about our commitment to this possible partnership,” Sporn said. There was consensus among the group and a motion passed to appoint Duluth YMCA CEO Chris Francis to the steering committee as a nonvoting member.
. Commissioner Bruce Martinson asked, “If we move forward, at what point do we form a community YMCA Board?”
Francis said as soon as possible, adding that they have to contact other YMCAs in the region to ensure that they would not be competing. Commissioner Fritz Sobanja asked if YMCA Camp Menogyn would be contacted. Francis said yes and the YMCA camp is excited about partnering efforts.
. The steering committee appointed three new members— Mike Groth, Cathi Williams and Gene Glader.
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