The YMCA of Greater Pittsburgh will exit bankruptcy less than three months after filing for Chapter 11 protection, but the nonprofit’s top executive said it faces tough transitions as it continues to reorganize programs and services — especially in communities where it plans to shutter facilities.
Following a hearing Wednesday in which U.S. Bankruptcy Judge Thomas Agresti said he would dismiss the case, Kevin Bolding, the YMCA’s president and chief executive, said he felt “guarded relief” that the organization can settle its debts outside of federal court proceedings.
“I’m relieved, but we still have a lot of work to do,” said Mr. Bolding. “It doesn’t change the fact the YMCA will continue to reorganize.”
The YMCA filed for bankruptcy in May saying it was running an annual deficit of $1 million.
It closed branches Downtown and in Delmont, Westmoreland County, last month and plans to close branches in Penn Hills and Wilmerding, and the Western Area YMCA in Coraopolis, at the end of August.
It has also laid off an unspecified number of administrative staff.
The top priority for the YMCA going forward, Mr. Bolding said, is “continuing our work in communities facing facility closures, especially so programming for youth doesn’t go away.”
To that end, he has begun meeting with leaders in those places to determine how and where to offer YMCA programs that now operate at branches, such as child-care, before- and after-school programs, camps and wellness programs.
On Wednesday morning, Mr. Bolding said he met with state Rep. Tony deLuca, D-Penn Hills, and plans to meet Thursday with Wilmerding Mayor Greg Jakub and that town’s borough council.
Thursday evening, the YMCA is sponsoring a picnic for several hundred members and staff of the Western Area YMCA which sustained major flood damage last month.
The key to emerging from bankruptcy so quickly was a deal the YMCA struck last month with the landlord at its Downtown Y to settle a costly lease.
That agreement calls for the YMCA to pay more than $2.75 million over the next four years to Millcraft Industries, the developer of the site the Downtown Y occupied at Fifth Avenue near Market Square.
Judge Agresti thanked attorneys for the YMCA and Millcraft for agreeing to mediate the matter.
“This is a tremendous result,” he said.
Millcraft was the YMCA’s largest creditor, according to documents filed in bankruptcy court.
Michael Shiner, an attorney for the YMCA, said the organization should be able to pay back creditors “without coming back to court.”
In its original bankruptcy filing, the YMCA estimated the number of creditors at between 200 and 999 and said its liabilities totaled between $10 million and $50 million.
Mr. Bolding said conversations would likely begin Thursday with some creditors to negotiate payments.
The organization expects savings of about $600,000 annually as a result of closing its branches in Penn Hills, Wilmerding and Coraopolis.
Within hours of announcing those facilities would close, Mr. Bolding said the YMCA received inquiries from potential buyers for the Penn Hills and Coraopolis buildings. It leases the branch site in Wilmerding.
He declined to elaborate on whether any deals to sell them were in the works.
“Our first priority is helping those communities and staff with the transition,” he said.
Joyce Gannon: jgannon@post-gazette.com or 412-263-1580.
This story was updated at 5:50 p.m. on July 25
First Published: July 25, 2018, 8:16 p.m.
