Building a facility in Temecula drained the YMCA's savings, and it has been struggling to pay the bills ever since.
YMCA employees' pay checks have been bouncing for several months, and some employees have gone two pay cycles without being paid, according to several YMCA workers.
"The first pay day of August, the pay checks started to bounce," said Taylor Cahill, a former aquatic supervisor at the Temecula facility, via an email. "When September came, pay checks were still bouncing, and staff members were starting to get kicked out of their (apartments), homes and condos because they couldn't pay rent."
The checks did bounce, but not because of mismanagement, said Jackie Fielder, the CEO of the YMCA of Riverside City and County, which owns and runs the Temecula facility at 29119 Margarita Road.
The checks were bouncing because building the Temecula facility drained the nonprofit's coffers, she said in an interview Monday.
"It strapped the organization. It just strapped it," she said.
The $4.8 million facility lost money by the tens of thousands since it first opened in May of 2009, and only this year has it showed signs of economic viability, Fielder said.
It lost $45,000 a month during its first two fiscal years, and in its third fiscal year, it lost $25,000 a month, Fielder said.
Today, the facility is in black ink -- just barely, according to Fielder. "It's pretty much at the break even point. Some months we lose $500, some months we make $500."
Building goes up, economy goes down
The organization committed to building the facility before the economy crashed and much of their funding disappeared, Fielder said.
The nonprofit runs on a combination of membership fees, government grants and donations, each of which was affected by the economy.
The Y's goal is to keep residents healthy, regardless of how much money they have. It does this by giving scholarships to members who cannot pay, and the government, donations and fees paid by other members make this possible, said Brian Herbertson, the local YMCA's marketing director.
When the economy tanked, the number of paying members shrank, the number of scholarship members grew, and donations grew scarce, he said.
"The need for our services has skyrocketed while our donations aren't what we would like them to be," he said on Monday.
The organization's facility in Hemet is the most extreme example, with 85 percent of the membership getting full or partial grants, Herbertson said.
YMCA of Riverside City and County runs four facilities: the flagship location in Riverside, one in Hemet, a childcare-only facility in Jurupa and the Temecula facility.
The local YMCA has a charter with the national organization, but when it comes to finances, it runs independently from the national organization, said Jessica Wylie, a spokesperson for the national YMCA organization.
The domino effect of bouncing checks
YMCA employees' paychecks began to bounce on Sept. 13, just after several school districts fell behind on their payments to the YMCA, Fielder said.
The Y contracted to provide after-school services for three districts: Alvord Unified, Perris Elementary and Riverside Unified. The state fell behind in their payments to the schools, so the schools fell behind in paying the Y, Fielder said.
So the nonprofit was unable to pay its employees, and more than 200 checks bounced, Fielder said.
Around this time, a hiccup in paperwork stopped the state from sending $65,000 a month in reimbursements for providing childcare services, Fielder said.
Fielder does not want to blame the state or districts, she said. "We should have been in a position to be able to front (that money) for 45 days," she said. "Our reserves went out the door after we built that Temecula facility."
Schools put in "very, very difficult situation"
The Y had employees working at Perris elementary schools without being paid, which put school officials in a bad position, said Virniecia Green-Jordan, the president of the Perris board of trustees.
"It put us in a very, very difficult situation," she said.
When checks started bouncing, the YMCA employees came to the Perris Board of Trustees and complained. "They didn't get paid for two paychecks, so they came to us," she said. "It was absolutely ugly."
The YMCA notified the district in December that it would cease offering services, Green-Jordan said. About 80 students at each school suddenly had no after-school programs.
"The parents were upset, they came to the school board meeting," the board president said. "It was very, very short notice."
School officials were furious, she said. "We contracted with the Y to provide that service. We were on time. We had already paid the contract. We did not know that the employees that worked at our school had not been paid."
Paychecks have been bouncing ever since September, though the organization always paid them -- albeit late -- and reimbursed workers for the bounced-check fees, Fielder said.
Around that time, the Y cut 315 people from its payroll in an attempt to get finances under control, which saved the organization $250,000 a month.
The organization's higher-ups are not immune. Fielder at one point went three pay cycles without being paid. "My checks don't bounce because I don't cash them. I wait until everybody else is paid," she said. "It hasn't been easy for anyone." She also recently took a 15 percent pay cut.
The bouncing checks hit the employees hardest, and many, like Cahill, the former aquatics supervisor, had to leave the organization, he said.
"Many of the staff that have left cared so much about the members and the kids that came through the YMCA every day. Many of the staff taught the kids how to swim and just formed amazing connections," he said. "They have destroyed many of the staff's lives."
The burden of a building
Putting up the Temecula facility was not a good idea in hindsight, Fielder said.
The Y paid to put up the building, but the City of Temecula owns the land. This presents a unique problem, Fielder said. Selling the facility is almost impossible, because nobody would buy a multi-million dollar building on somebody else's land.
"The only people who could buy it are another YMCA (chartered organization), or the city," Fielder said.
Fielder was promoted to CEO in 2010 -- Robert Coleman was the CEO when the Temecula facility opened -- and she has been dealing with the problems the facility created ever since.
She feels the organization's leadership got swept up in the euphoria of expanding, she said. "It feels good to build a new facility," she said. "I think we grew too big, too fast."
Now, the organization has no choice but to keep the doors open and make this facility work, she said.
Keeping the faith
Despite all the hardship, Fielder believes the organization's problems will soon be over, she said. "We're a faith-based organization, and I have faith," she said, her eyes welling with tears.
This realization hit her last week during a Good Friday breakfast at the Riverside facility.
The nonprofit provides meals for the needy every year on that day, and usually she books 49 tables. This year -- due to demand -- she booked 66 tables.
"The place was slammed," she said. "I wondered whether this is ever going to get better. Then I looked out into that sea of people… and you have to know, everything's going to be OK."