The Herald Banner, Greenville, TX

April 22, 2013

‘First and foremost, this is a YMCA’

Everything you need to know about the proposed YMCA

By Caleb Slinkard
Herald-Banner Staff

GREENVILLE — The proposed new YMCA is one of the biggest issues in Greenville in recent memory. The project, which has evolved over time, has inspired strong support and opposition. Below is the most up-to-date information from the YMCA about their project.

We hope that it will provide you with the information you need to make an educated decision on May 11. To comment on the project, contact us at editor@heraldbanner.com.

Leading up to the current proposal

The current YMCA building is more than 50 years old and will quickly no longer be operational. The YMCA officially began a fund-raising campaign in June of 2011 to raise money for a new building. Initially, the YMCA of Greenville-Hunt County was looking at building an $8 to $10 million facility, according to CEO/Executive Director Kelly Gaudreau.

“We estimated that would could raise $3 to $4 million, so we knew we needed to raise an additional $5 million to complete the project,” Gaudreau said. “We received an initial bid for the project of $205 per square foot.”

Various organizations committed $4.6 million to the project, including the Greenville Independent School District, L-3 Communications and private individuals.

However, the YMCA was told that they were not going to receive a $2.6 million grant that they were expecting, and the capital campaign did not raise enough funds.

“We just weren’t having a lot of luck; people were giving, but they weren’t giving to the level that brings us further along, faster,” Gaudreau said. “Because I have this ticking time bomb in my hand, which is the building, and the life of that is very short, we were trying to raise money quickly.”

In November of 2012, the city council named Jerry Ransom chairman of a committee designed to determine if the city needed a YMCA, and, if so, how the project would be funded and how viable it was. The committee made a final recommendation to the city council in February, and the council subsequently voted to place the $15 million bond election on the May 11 ballot.

According to Ransom, even if the initial capital campaign had successfully raised all of the necessary funds, the YMCA would still have needed “a financial partner to write the check once the construction was finished.”

 

Current proposal

The YMCA used the same bid of $205 per square foot to budget the new facility, a planned 70,000 square foot building. The YMCA settled on 70,000 square feet after discussing space needs with other community organizations. A 70,000 square foot facility, at the bid price, would cost $14.34 million.

According to Gaudreau, other equivalent YMCAs are being built for between $135 and $175 per square foot. Gaudreau is confident that the new building could be constructed for $165 a square foot, which would bring the facility’s cost to $12.375 million. The YMCA is estimating that it will cost approximately $1 million to furnish the facility.

According to Ransom, the YMCA is a YMCA first, not an events center. While the initial project included two gymnasiums, the YMCA added the ability to host events by including a third gym, a 2,500 square foot lobby, and approximately 1,000 to 1,500 square foot of storage space in their proposal.

“First and foremost, this is a YMCA, not a convention center,” Ransom said. “Also, it is not intended to compete with the Landmark or even the [Fletcher Warren] Civic Center. But there are opportunities [for this building] to serve crowds over 400.”

The YMCA presented a pro forma, or business plan, to the city council, which included some details on the new structure.

“There are details that need to be worked out, but a lot of the details we know,” Gaudreau said. “We know the size of the Y; we know the footprint of the Y, because we based on our pro-forma on it. So we have some very solid conceptual plans that we’ve been working on. We know the sizes of the rooms we need, we know what is going in those rooms and we know the locker room layout.”

The land and YMCA building would be owned by the city of Greenville, and then leased to the YMCA for a nominal fee. The city would also need to complete infrastructure work around the facility, including extending water and wastewater lines to the proposed construction site in the Greenville SportsPark.

YMCA fees will not be increased, according to Gaudreau.

Why build now? According to Ransom, there are three main reasons the YMCA committee wanted to get the bond election on the May 11 ballot: interest rates are currently low, construction costs could potentially rise, and the current YMCA building is falling into disrepair.

 

Community involvement

The YMCA proposal includes space for several local organizations. The swimming pool would be used by the school district to train students to swim. GISD has committed $1 million for the project, $100,000 a year for 10 years.

The Hope Center of Greenville would have space set aside for its programming, which would include access to a computer lab and teaching kitchen. The Boys & Girls Club of Northeast Texas would also have access to a teen room for their teen program.

The Hunt County Commissioners Court has passed a resolution of support for the project, and will look at possibly donating funds during their budgeting process.

Ransom has committed $1 million ($100,000 per year for 10 years) to the project, and the YMCA has received other private contributions.

Paris Junior College’s Greenville location could potentially use the new building as a recreation facility for their students, although allocating funds for such a program would have to approved by the student body. According to Gaudreau, the new facility could also be used by PJC and GISD to host basketball tournaments.

The YMCA has been in discussion with SUBWAY to place a restaurant in the facility, but no agreement has been signed. If an agreement is not reached, Gaudreau says the Y has a “back-up plan.”

The new proposal has also received verbal support from L-3 and Hunt Regional Medical Center.

“This project isn’t about the YMCA or me,” Gaudreau said. “It’s about increasing the quality of life for our county and making an investment in our future.”

 

The cost

All of the money raised by the YMCA through their fund-raising campaign will go toward paying the bond’s debt service, according to Gaudreau. Based on contributions offsetting the $15 million bond, Gaudreau estimates a property tax increase of $0.024 per $100 of taxable assessed value. This would cost someone who owns $100,000 of taxable assessed value $24 per year for the first 10 years of the 25 year bond.

The increase in the tax rate for the final 15 years of the bond is unknown at this time, because that number would be based on property values, which fluctuate. Additionally, Gaudreau hopes that the funds generated by the events center would be able to offset some of the cost in the bond’s final 15 years. The tax burden on Greenville resident could therefore increase or decrease, depending on the profitability of the events center and local property values.

Any profit from the YMCA, apart from money that Gaudreau has planned to set aside for facility maintenance, would go toward paying the debt service, with the city paying the difference. The first debt payment would be due in 2015.

According to Gaudreau, the funds raised so far by the YMCA would cover approximately 60 percent of the debt service payments in the first five years of the bond and approximately 50 percent in years six through 10. After 10 years, the city of Greenville’s current debt obligations reduce significantly, which would free up the city to take on a higher percentage of the debt service payments.

“We’re still fund-raising, so the hope is that there are still people out there that will give money to this project, which would lower that $24 a year even more,” Gaudreau said. “We really focused on the first 10 years, which gives the YMCA time to establish itself and the events center to become profitable.”

The YMCA has told Greenville, according to Gaudreau, that the city will never have to pay operational costs for the building. The Y will cover those costs through memberships and programming revenue.

 

Management

The YMCA would be managed by the YMCA Board of Directors; but for the purpose of running the events center, Gaudreau has suggested the city council establish a management committee that could be made up of representatives from organizations throughout the county.

Gaudreau has discussed the makeup of the management committee with the city, the YMCA Board of Directors and GISD, but the details regarding the membership and responsibilities of the committee have not been determined. The management committee would be in charge of bringing events to the YMCA.

“I have a person that puts on events at the Y, and she does a really good job, but bringing events is not my forte,” Gaudreau said.

The YMCA has done research that indicates the events center could host about 25 events a year.

“Most of the events we’re talking about book months, even years in advance,” Gaudreau said. “From some of the very preliminary research we’ve done, you’re talking about 25-30 events a year. So those things would be put on the calendar, and then the Y would try to book around that.”

In a proposal to the city council, Ransom also suggested that the council to put together a building committee to oversee construction of the project.