YMCA CEO fires back at report over city/YMCA contract
Bob Hall points out some discrepancies in the report
The CEO Of the YMCA of Columbia-Willamette is firing back at a report conducted by a Lake Oswego accounting firm that reviewed a contract between the city and the Sherwood Family YMCA.
Bob Hall, who is also president of the YMCA of Columbia-Willamette, objected to a number of conclusions and recommendations put forward by Talbot, Korvola & Warwick, LLP. Among them is that the agreement between the two groups is vague and over time has been interpreted differently.
Recently some questions have arisen but for the first 14 years of the agreement, there have been few, if any, disagreements, Hall wrote about the report conducted by Rob Moody, which the city released publicly March 18. For instance, the use of the annual excess is a long-standing agreement with the city and the YMCA. Consulting with past mayors and city managers will validate that.
Specifically, Hall said that the report stated that the city might have received $438,000 except for the agreement between the YMCA and city as to the use of the annual excess, if any.
The report, which cost the city $6,000, didnt state that the city owns the facility and consequently the use of the proceeds improves a city owned asset, not an asset of the YMCA, Hall wrote.
In addition, Hall said YMCA officials believe Moody may have misread the contract on that issue.
Our auditor reviewed this same section in 2011 and determined that the calculation would result in the city receiving (through 2011) $81,118 and the YMCA receiving an additional $228,083, he wrote.
Hall goes on to list the following benefits the agreement between the two groups has produced. They include (taken verbatim from Halls response):
1) The Sherwood YMCA provides over $325,000 annually in free or subsidized services to 1,135 individuals and families who could not participate otherwise. These include, but are not limited to the following programs and services: homeless assistance, SNAPS and The Transition Program.
2) The YMCA, at the buildings opening, raised the initial $125,000 for the pool slide.
3) The YMCA has made annual payments to the City of Sherwood to pay debt service expense for building expansion that enclosed the gym, added 5,000 square feet in programming space and 5,000 square feet for the Teen Center. In addition to the above, the YMCA raised $250,000 in capital gifts to support the expansion.
4) The Sherwood YMCA subsidizes the operation of the Teen Center each year, which has made the Teen Center free to all Teens in the community, for the past 12 years, providing a safe and positive place for Teens after school.
5) Over the years, City Managers and the YMCA agreed to forgo dividing the annual operating surplus of the Sherwood YMCA, if any, as allowed in the agreement. Both parties did this to improve the city owned asset and strengthen the Sherwood YMCA operations.
This represents a gift to the City of Sherwood and the Sherwood community by the YMCA, exceeding $225,000 as determined by the YMCA independent auditor.
6) In addition, the YMCA, by contract, can charge 15% for Management Services. In some years, the YMCA has charged less, putting the money back into the Sherwood Y for upgrades.
The Management Services Fees charged through 12/31/2012 are $4,308,140.
The Management Services Fees earned through 12/31/2012 are $4,725,393.
The difference of $417,253 represents an additional investment or gift made by the YMCA toward the success of the Sherwood YMCA.
7) All this has allowed the YMCA to invest nearly $950,000 in capitalized program and building improvements in the Sherwood YMCA facility, through 2013.
Our Capital Purchases made through 12/31/2012 equal $757,693.
Our Capital Purchases made in 2013 equal $191,428.
Our CFO and the City of Sherwoods Director of Finance have conferred and discussed the numbers contained in points 6 and
8) The Sherwood YMCA executive director and staff are very involved in community events and take a leadership role along with the volunteer board of managers. Events such as Cruisin Sherwood, Community Service Fair, Onion Festival, Robin Hood Festival, Altered Arts Festival, Give n Gobble and more, are strengthened by YMCA participation.
The report states the following, The YMCA indicates that costs in support of the local operations exceed the 15% charged for overhead on an annual basis. We inquired as to any analysis at the corporate level showing the percentage of total support costs (human resources, legal etc.) attributable to the YMCA as a percentage of the total for the corporate organization overall. At the time of this report, that information was not readily available. I am not sure of the relevancy of this section as the YMCA has never asked to increase the Management Services percentage which is clearly outlined in the agreement.
The YMCA is open to considering mutually beneficial amendments to our agreement. We highly value the special relationship we have with the City of Sherwood and the Sherwood community and we look forward to continuing to serve for many years into the future.
In response to Halls comments, Mayor Bill Middleton said: The YMCA couldnt (or wouldnt) provide complete financial documentation for us to audit. Instead, our auditor had to rely on the piecemeal financial documents after 2001 that were provided and the testimony of the YMCA director, Renee Brouse, and other members of council. Even so, the report clearly states that this contract is vague, poorly written and has been mismanaged through the years.
He went on to say: The bottom line is this the Sherwood recreational facility is the biggest physical asset in the city of Sherwood owned by the citizens and operated by the YMCA. For years this poorly written contract has been handled in an unprofessional and good old boys manner that is both disturbing and concerning.