Boys & Girls Club Can’t Raise Enough to Stay Ahead: Officials Claim Club Struck With Financial Woes; Predict Better Days Ahead

By Jeff Raymond, The Brownsville Herald, Texas

Apr. 2–Just a few years ago, the Boys & Girls Club of Brownsville had a healthy bank account with enough to cover its expenses for months.

By the end of the 2004, it had $17,557 in the bank, according to its most recent filings with the Internal Revenue Service.

The club has spent down its reserves and weathered a $70,000 judgment amid fund-raising and cash-flow troubles.

The club in recent weeks has closed its Eighth Street headquarters and eliminated programs at Oliveira Park to cut costs. The club now only has operations in Cameron Park and Gonzalez Park.

“While things are tight right now — I won’t lie to you — things also will look a lot better in the next few weeks. … It’s a matter of us getting to a point where some of the effects of the reorganization can start taking place,” Executive Director Alex Barrera said.

The club cut its budget Thursday by about 40 percent, reflecting the downsizing of recent weeks.

Despite having a good year in 2004, increasing its revenue by $192,273, or 32 percent, over 2003, the club ended the 2004 fiscal year with $67,841 in debt. By comparison, the Boys & Girls Club of Harlingen, which has five full-time and eight satellite clubs, for 2004 reported a surplus of almost $150,000.

By year’s end, the Harlingen club had grown its net assets by $148,785, to almost $1.1 million. The Brownsville club’s yearend net assets decreased by $67,841, to $444,463. The 2003 pattern was the same: The Harlingen club increased its net assets by $41,630, while the Brownsville club’s decreased by $46,757.

“I can’t point to any one event that shows that they overspent or anything of the sort,” Barrera said of previous boards and administrators, most of whom are no longer involved with the club.

The Harlingen club in 2004 also received considerably more in contributions from the public than its Brownsville counterpart — $319,970 to $76,270. The Harlingen club’s executive director, Gerald Gathright, attributed fund-raising success to the club’s stability over the years — 29 of which he has been in charge — well-respected board members and a community accustomed to supporting the club.

Barrera said someone was ready to give a “sizable” five-figure sum to the Brownsville club, a fund-raising practice he said they need to emphasize.

Financial difficulties and reimbursement-only grants have had a definite effect on club projects.

It can’t muster the up front cash to pay for swimming pool resurfacing and asked the city to take over the project.

Although the club, which briefly shut its doors last year, has $288,000 remaining from the U.S. Department of Housing and Urban Development and the Brownsville Community Improvement Corp., it cannot access the funds.

BCIC gives money on a reimbursement basis. As such, the club has been unable to sign a contract for work at its Cameron Park facility. BCIC awarded the money in 2004.

Barrera said Cameron County likely would take over construction of the Cameron Park building. In return, the club would cede the $288,000 to the county. A county spokesman did not respond to a request for comment by press time.

Caterer Juan Hernandez in September 2004 sued the club in Cameron County Court-at-Law No. 3 for payment for meals served during a period when the state declined to reimburse. Judge Daniel Robles ruled in favor of Hernandez.

The late July $70,000 judgment remains unpaid.

A March 2005 deposition shows the club’s troubles went back at least a year. During the questioning, former Executive Director Lou Gracia said the club was surviving month-to-month.

Barrera has said the downsizing was necessary to get the club on solid footing, a decision he said should have been made years ago. The club has money it is pursuing and will make a strong fund-raising push when it increases its board to about 15 or 20 people in coming weeks, but the judgment still looms. “The fact that it’s out there has had an effect on our ability to raise funds as freely as we normally would,” he said, explaining that donors have asked about the judgment. “We owe it. We’ll pay it. It’s just a question of how we can best do it without hurting ourselves.”

Club leaders say they would like the city to purchase their Eighth Street facility. The club owns the building; the Diocese of Brownsville owns the land.

However, the arrangement between the diocese and club leaves unanswered questions. Perhaps the most important is whether the diocese would seek to alter the terms of the $1-a-year, 50-year lease should the city become involved.

City Manager Charlie Cabler said the club had a “huge amount” of money set aside for building renovations that it couldn’t access until it had sufficient funds up front.

If the club turned over the building to the city, it could immediately reopen, he said, noting the city was working to set up meetings with diocese officials regarding the potential purchase.

“We can discuss buying it, or they can give us a long-term lease,” he said, adding that the City Commission supported getting the main unit reopened.

Diocese spokeswoman Brenda Nettles Riojas said the diocese had received the city’s letter and was reviewing the lease.

“We are very interested in cooperating with the city,” she said.

Kevin Bingham, senior regional service director with the Boys & Girls Clubs of America in Richardson, said the national organization supported the Brownsville club’s measures. He predicted the club would emerge stronger.

“I just feel like they’re doing what they need to do,” he said.

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