YMCA warned city two months ago that it might have to close

Sault Ste. Marie YMCA notified city officials two months ago that it was no longer fiscally fit and might have to close, according to an update going to city councillors on Monday.

"The YMCA approached city staff in late February 2024 to notify that the YMCA is experiencing significant financial hardship and operational issues that may cause the facility to shut down," Brent Lamming, the city's director of community services, says in a report to Mayor (Matthew) Shoemaker and ward councillors.

Lamming reports that the city it is willing to explore options to support the local Y, and outlines what actions the city has taken so far.

Lamming stops short, however, of recommending any specific steps the municipality might take.

The charity, which employs about 140 people in the Sault, is "an independent, charitable organization," he says.

"It has its own board of directors and operates completely separate from the City of Sault Ste. Marie. There has been no ongoing municipal funding support provided to the YMCA in the past and the city does not have any oversight or involvement in YMCA operations."

The following are the main takeaways from Lamming's report:

Purpose

The purpose of this to report is to provide an update to Council on ongoing collaboration efforts between the City and local YMCA.

Background

The local YMCA was constructed in 1965 and has provided a variety of youth and family programming supporting the community for many years while at the same time producing provincial- and national-calibre athletes in sports such as swimming, gymnastics and boxing.

The YMCA employs approximately 135 staff and offers important childcare programs for the community.

Membership is approximately 3,300 which is up from 3,000 a year ago (it was 7,000 at its height of operations).

The YMCA is an independent, charitable organization. It has its own board of directors and operates completely separate from the City of Sault Ste. Marie.

There has been no ongoing municipal funding support provided to the YMCA in the past and the city does not have any oversight or involvement in YMCA operations.

The YMCA approached city staff in late February 2024 to notify that the YMCA is experiencing significant financial hardship and operational issues that may cause the facility to shut down.

The board has been working with YMCA Canada (Y CAN) and YMCA Ontario (Y ON) to review the situation and provide guidance on a plan to either wind down operations or develop a sustainability plan.

YMCA Canada declared that the Sault Ste. Marie YMCA (SSM Y) was in financial crisis in 2021.

The SSM Y has approximately $1.5 million outstanding in debt obligations

YMCA

Local YMCA representatives advised that having a sustainable operating plan is the number one priority for SSM Y in order to be able to continue as a viable entity and satisfy requirements of Y CAN and Y ON.

Analysis

City staff have met with SSM Y, Y CAN and Y ON representatives and have been advised that YMCA Childcare programs are anticipated to continue in Sault Ste. Marie, with a different YMCA oversight organization.

YMCA is working with the Sault Ste. Marie Social Services on this item. Their preference is YMCA of Northeastern Ontario (Sudbury, Timmins, North Bay.

YMCA health and fitness services will end May 15, 2024

Upon learning of the dire circumstances of the YMCA, staff engaged with the interim CEO and board members in discussions to explore options and alternatives to avoid closure.

Beyond the initial discussions, staff undertook the following steps:

• requested 2022-2023 re-stated financial statements. Received
• requested cash flow statements, and projections. Received
• requested a copy of the 2007 building condition assessment. Received
• requested a copy of an executive summary of building condition dated 2019. Received
• requested a list of major repairs/renovations completed over the past 15 years. Advised the value of investment is more than $4 million in building improvements since the condition report was issued. Received
• met with Y CAN and Y ON representatives to gain a clear perspective on the operating models that are working well. Sault Ste. Marie is one of the last remaining standalone YMCA enmities in Ontario. For successful operations of current day YMCAs, it is typically under a regional model and in collaboration with the local municipality. Often the municipality will own the building and the YMCA is the operator. Examples include London, Stoney Creek, Goderich, Kingston, Toronto, Middlesex, Innisfil, Wasaga Beach etc. Northeastern Ontario and southwestern Ontario are two options to pursue for a regional operating model for health and fitness and childcare operations
• ongoing meetings continue to occur with the city, DSSAB, SSM Y interim CEO, Y ON, Y CAN and board representatives

Lamming's report also warns that closure of the SSM Y will have detrimental effects on the community in several ways including:

• pressure on the John Rhodes swim lesson programming and eliminates an indoor pool available to the community. Approximately 325 swim lessons are being provided at the YMCA per session (1,175 annually)
• eliminates opportunities for disadvantaged youth for programming (youth basketball-YBC, swimming, gymnastics, day programming, new resident programming and drop-in programming). 130-day camp spots per week over 9 weeks to total 1,170 per summer
• affects 3,300 health and fitness members
• impacts staff – currently there are approximately 135 staff on payroll. Approximately, 50 per cent are childcare and the 45 per cent would be facility staff (health and fitness, cleaning and maintenance) and five per cent are administrative support

Currently there are three rental agreements within the facility: GHC cardiac rehab program, adult enrichment centre, café services

Additionally, there are room rentals from different community groups. From a user perspective, the YMCA works with many groups including Community Living Algoma, Ken Brown Home and the Indigenous Friendship Centre to assist their clients benefitting from the use of the YMCA’s programs and services.

The YMCA has a subsidized membership program which operates from the principle of people paying, as able, for a YMCA membership. In recent years, the SSM Y have observed a growth in the number of new Canadians using the YMCA as a means of integrating into the broader community.

The Y day camp utilizes two community sites, Waterfront Adventure (formerly RYTAC) and the St. Kateri Outdoor Learning Centre.

City staff participated in the YMCA board meeting held Tuesday April 9, 2024 and notified the board that the city is supportive to explore options to aid in the continued viability of operations for the YMCA.

This centered around the following:

• participation in discussions to stabilize banking arrangements  (current bank and/or new bank)
• explore preparation of a capital request submission for counsel to review to Explore preparation of a capital request submission for Council to review to address urgent repair(s) using the city grant program in combination with potential NOHFC funding
• explore regional model of governance, hiring of new leadership and city options to support
• should a resolution not be found for the existing building, establish a working group with various partners to explore the potential to construct a new, efficient building for a long-term prosperous YMCA
• explore an application to the recently announced $200 million sports and recreation funding stream from the province of Ontario

Moving forward, it was agreed a working group will be established consisting of staff from the city, DSSAB, Community Living Algoma, three SSM YMCA board members and YMCA ON representative(s).

There has been some interest since the property has been listed for sale. The city will help assist in any way it can to coordinate any potential opportunities or partnerships that see a continued SSM Y operation.

The current situation with the YMCA is evolving and staff continue to engage with the YMCA and community stakeholders to explore options and alternatives.

It is recognized the important role the YMCA plays in the community but also that the YMCA is an independent charitable corporation governed by a board of directors that is making the decisions on the organization’s future.

The city has indicated that it is willing to explore options to support the YMCA.